By: Josh Huseman, Vice President, Business Owner Advisory Services
It may seem incomprehensible to think about selling a business while it is thriving, but eventually every owner reaches the point where they are ready to exit. Planning your ideal departure can begin with a few simple considerations.
Business sales usually fall into two categories: internal and external. In general, internal sales transition control of the business to a person already embedded in the company, and external sales are an outright sale initiating a change in control and ownership to an outside party.
Business owners who think ahead have more possibilities than they may realize. Here are a few insights to help you begin planning.
Internal sales provide an excellent opportunity to maintain company culture and, especially in the case of family-owned businesses, can be the preferred scenario for an outgoing business owner. Owners contemplating this exit type are often concerned with employee security, customer relationships and community connections. These are important issues to those who have built a long-standing business, and to be successful, there are several things to consider:
When given early thought and preparation, an internal sale can ensure your life work is transitioned to highly motived owners who will continue your professional legacy.
External sales introduce an extra level of complexity, often requiring more forethought than an internal sale. That’s why we developed a Prepared Exit process to help owners prepare for what might be their most significant professional transition. This also can be a very emotional process, and we have found it helpful to give thought to six common considerations before a potential deal is presented.
Whether you are considering an internal sale, an external sale or still exploring your options, it’s important to take control of your exit. Planning ahead allows you to choose the option that is best for you and your business.
About the Author
Josh is the Vice President of Business Owner Advisory Services. Josh is motivated by a strong desire to see business owners impact the world through their core values and entrepreneurial spirit. He is particularly intrigued by the unique opportunities and challenges that come with family-owned businesses, and he works hard to help them realize their full potential.
The articles in this blog are for informational purposes only and not intended to provide specific advice or recommendations. When making decisions about your financial situation, consult a financial professional for advice. Articles are not regularly updated, and information may become outdated.