SOLID ADVICE –
INTELLIGENT INVESTING
info@brothersandco.ca
www.brothersandco.ca
Phone: 306.337.4500
230 - 10th Ave. E., Regina, SK S4N 6G6
p: 306-569-3000 f: 306-565-2400
e: info@wappel.ca
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the trust of clients to the new owner-operators. The process does
depend on the business – a manufacturing business might be easier
to turn over to professional managers, new owners or a larger entity.
You might dream of someone showing up at your doorstep with a
great big cheque, but that’s rare, and even then, the trauma to your-self
and the employees might be more than you want to take on.
2. The existing owner becomes the bank
In fact, you rarely ever get the cash upfront. In most cases, you’re
selling to key people, like family members or employees, so the pay-ment
for the business typically comes in the form of a combination
of bank and vendor financing.
It’s very difficult to go and borrow money to buy a private enter-prise,
so in most cases the existing owner basically becomes the
bank. This common financing scenario is another reason why own-ers
often stay involved even after they depart.
3. Make sure you have liquid assets
Financing a sale can also cause headaches due to the fact that most
owners invest heavily into their own business, leaving them with
a lack of cash. For most business owners, a good part of their net
worth is tied up in the fixed assets and shares of the business, which
may be illiquid and have significant tax consequences.
FINANCIAL FILE
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54 Think BIG | Quarter 2 2016 | saskheavy.ca
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