That was doing well. Of course Successful companies get sold all the time.
So why do These business owners sell? The short answer is That most closely held businesses sell for human Reasons, Standard and Poor 'burn out, retirement, illness, partnership Disputes, family or other personal issues Reasons. Usually the business is fine but the human beings running the business needs a change. To understand this better it is key to understand the other options for Exiting a business.
Close the Business / Liquidation
Closing a Business That Is profitable never makes sense. Even if the assets are liquidated the price is likely to be pennies on the dollar versus selling the business as a going concern with employees, customers and a reputation That is intact. Not only does the business owner get the lowest values but the employees, vendors and customers are hurt by this type of exit.
Accident, Illness or Death
No one wants to exit on their business this way, but many do. The loss of an owner not only creates tremendous issues for the family but Also creates a leadership void in the business. Even the most competent management struggle Pls Can a key business leader is lost to a serious accident, illness or death. No one plans for this type of exit but many end up Exiting the business this way Because they want failed to create an alternate plan.
Succession .
Succession by a family member or key employee has its benefits. They know the business, its product or service, employees, customers and vendors. Can be operationally Successful Succession for the Exiting Owner If they want to make sure the successor is carefully selected, qualified and groomed for the position. The owner must be careful not to make an emotional choice of a favorite relative or employee but instead choose the successor with the right skills to lead the company into the future. You are not seeking an "Employee" mentality but an "owner" mentality. That rare person if Can be found in the Business World Health Organization cans make the transition to the Owner, they want often do not have the cash needed to purchase the business. Also They are likely to want to pay less for the business as familiarity will of Them blind to many of the value drivers of the company. So although the succession Successful Can be operationally it is rarely a financial success for the outgoing owner.
Sell .
Closing or liquidating the business minimizes the value to the owner. Accident, illness or death forces the issue on the owner. Succession provided a very limited pool of options with limited financial rewards.
Selling on the other hand allows the business owner to Decide on their ideal timing, maximize the value of the business they want worked so hard to build, coordinate the use of the Sale Proceeds for financial planning on their personal goals and align with the sale of a business. Selling the business allows the business owner to create a wealth event and often significant on-going passive income without having to run on their business.
Whatever they want are, human Reasons are always pushing and pulling on a business owner. Burn out, stress, Divorce, illness, Disputes and limited partner capital growth of the human are Some Reasons That push owners out of the business. Retirement, enjoying life, relocating, a new business opportunity
and passive income are Some of the Reasons That pull out a business owner. Whatever the motivation, the fundamental reason from a business owner chooses as a sale on their exit plan is an ideal control. The business owner chooses to understand the value of on their business and to proactively pursue the right buyer and the right price. By selling a business you choose to exit your business by choice, not by force.
RELATED TAGS : BUSINESS , FOREX , REALESTATE , MARKETING , AUTOMOBILES , CURRENCY’S , INVESTING IDEAS , SHARES , BUSINESS INSURANCE , LIFE INSURANCE
