Succession Planning: How to Sell Your Business
December 6, 2017 by David Bojanic
When building the succession plan that will determine where you and your business will be after you retire, there are primarily two ways to go: internal succession or selling your business. At Gordon Advisors we know that both options may be on the table until a decision is made, often based upon the overall value of the company. If you are considering selling your company, there are six avenues you can take: selling your business interest, an Intentional Defective Grantor Trust, family limited partnerships, private annuities, transfer of interest through a buy-sell agreement, and self-canceling installment notes (or SCIN).
Before you can decide how to sell your company, you need to understand its value. Do you know your company’s true worth? Our experience has shown that many business owners believe it is worth more than it actually is, simply because of their emotional valuation of their own years of sacrifice and hard work. While these are likely among the reasons a business does succeed, they are probably not a factor in determining the true value of your company. While that reality may have deflated your business owner balloon, it is better to go into selling a business with your eyes wide open than to make decisions based on unfounded speculation.
Getting over that hump is just the first step; however, and our guide Anatomy of a Succession Plan can help you get over the remaining bumps in the road to selling your business. The guide offers plenty of professional wisdom about how to choose a professional to evaluate and assess the worth of your company, and what financial options and strategies should be considered in your succession plan.
For example, have you considered the possibility of selling to someone within your company? Do you know at what stage of your life you want to sell? Do you understand the complexities of the taxes involved in the different kinds of sales? There is a lot more to it than just, “sign on the dotted line.”
Anatomy of a Succession Plan helps you answer these questions and exams other sale options including the benefits of selling via private annuities, business transfer through a buy-sell agreement, family limited partnerships, and more.
At Gordon Advisors we know succession planning through a business sale is both emotionally and technically complex. But thanks to our own experience and expertise, we also know how to make selling your business a more informed and less stressful transaction. In fact, Anatomy of a Succession Plan was written by Gordon Advisor’s Chief Operating Officer Jeff Farrington, MSM, and Principal Hannah Thoms, CPA, MSF, CFP®, who combined their decades of experience to make the guide a great start to a succession planning.
Find out what you need to know about selling your company. Download our free guide and breathe a sigh of relief knowing you have the facts from the professionals at Gordon Advisors.