So earlier on, once you start being successful in business, it’s in-cumbent
to start getting some money out of the business and into
other places, just in case. Having liquid assets available may be the
lubricant you need at the time of sale while waiting to get money
out of the business.
4. Plan for succession from the beginning
Another key part to successfully selling a business is having solid
plan from the beginning. You need to make sure that what you’re
selling is actually a transferable, salable business. You should also
have a repeatable business model, with processes in place, and ev-erything
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documented.
And you need to show that you have good financials: many business
people take out all the money they make from their business, but leav-ing
some money in the business, showing a profit, shows to the buyers
and the bankers, that this is actually a transferable and viable business.
Selling a company that you’ve poured your heart and soul into for
any amount of time can be emotional and difficult. By ensuring that
all of the financial aspects are aligned and in place, you’ll be able to
reduce some of the most stressful parts of the transition.
Chet Brothers is founder of Regina-based Brothers and
Company and is the only Saskatchewan financial advisor
named to the Top 50 Canadian Financial Advisors
ranking by Wealth Professional magazine.
“It’s very difficult to go and
borrow money to buy a private
enterprise, so in most cases
the existing owner basically
becomes the bank.”
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