Do you have an end game?

You’ve grown you business gradually and now your mind turns to collecting the reward from your investment in capital, know-how and years of effort. Achieving the most money for your business requires the same diligence it took to grow it. So, how can you ensure you receive a return for your efforts? Effective succession planning is the key to protecting, growing and realising the maximum value for your business. It is a strategic process that allows you to smoothly transition the ownership and/or management of your business. Research shows that business value can be impacted by a number of issues, including:

Business owners often being unaware of all their succession options

Generation Y’ lacking the aspiration to be a business owner

Increased house prices restricting the funding options for successors.

Why is succession planning a key issue now?

Do you remember what you paid for petrol when you started in business? Maybe 39 cents a litre? Times change, markets change, and so does the business environment. Not long ago, business entry costs and competitive forces were lower and business growth could be funded by borrowing against increasing house prices. Business success demands focus by you on the operation, but ultimately, issues of succession and retirement will creep up. By then, getting the price you need could be elusive.

The next generation of business owners, ‘Generation Y’, face a completely different business environment. Start-up and acquisition costs are higher, and competition has increased. Business funding opportunities are also more limited in comparison.

You’re a business owner and you understand the driving forces behind competition, supply and demand. So when:

More businesses are for sale – lower prices result

With fewer qualified buyers – it becomes a Buyer’s market

In a Buyer’s market – they can be selective and value driven

Thus, it is important for you to start planning your succession now to maximise your final price.

Contact your Altitude Business Consultant for help with establishing and implementing a personalised succession plan or visit our Succession Planning page for more information.