Frequently Asked Questions

How long does it take to plan an exit from a company?
We think five years is a good timescale but in terms of succession planning(cross reference to succession what to consider) and three years for sale but as soon as you start your business you should consider this.

Don't I just to need to advertise my company for sale or find a transfer agent?
The problem with this approach is that you may not get the best price and what is the price you should ask for? It does not give you the chance to consider other options for exit (please cross reference to type of exit page).

Can I keep my accountant?
Yes we are not accountants and like to work closely with your accountants.

Isn't this what my accountant can do for me?
Your accountant focuses on the figures, we work much more broadly and also think further ahead.

Why should I be thinking about succession now?
The key to the success of your succession plan is ensuring that the value of your business is maximised when you are ready to sell. This takes time; it cannot be done overnight and it cannot be done without proper planning.

If you want to use your business equity to fund your future lifestyle, you need to plan now to ensure the value locked up in your business is released to you on exiting.

How do I determine the value of my business?
Most business valuations involve an assessment of past profit and a determination of what that profit is worth in 'today's pounds'. Many are based on:

• The industry in which the business operates
• The business risks and future prospects
• The profitability, cash flow and financial position of the business

How do I choose my successors?
Prepare a checklist of all the important qualities that future owners of your business must have, and rank prospective successors against these criteria. The checklist should include specific skills and areas of expertise as well as values, financial capacity and other measures that are important in achieving a successful match between you and the prospective buyer.

Why do I need to pay to sort out my own succession?
What many business owners fail to understand is that succession planning is not simply an exit strategy. It's also an entry strategy for those assuming responsibility Ð whether family, employees or an external buyer.

Two of these three potential successors might be buying houses, having children and experiencing other financial pressures which render them unable to spend the cash for equity in the business. This is why developing a funding plan is integral. Not only can it ensure the smooth transition of your business to employees or family, but a good plan maximises the value of your business even if you decide to sell externally.

Which is the best sale - an internal or an external sale?
Internal sales or management buy-outs have been, in our experience, the most value-maximising processes in succession, for a number of reasons. Not only do they give you greater certainty about the ongoing potential of your business, but you can time your transition to the company's needs. Further, the people who work in your business know more about it than anyone else, and if you have worked with them over time, they will have developed the ownership behaviours required of them to be successful.

You can feel assured that existing staff will be looked after and the values of the company will continue.