Choice of new owner impacts exit plan

Exit planning involves valuing your business and identifying potential buyers. Two weeks ago, I discussed business valuation. Today, we'll look at potential buyers. These include family members, business partners, outside individuals, other companies and employees. You might run your business differently depending on your planned exit strategy and what would be most important to the likely buyer(s).

• Be careful in selling to family members. What if one offspring is interested in running the business and another is not? Or what if you have several children interested in ownership? Can the business that has done well for you support multiple owners? Would co-ownership and subsequent decision-making create problems within the family? For an owner with an only child brought up in the business, however, a family transfer might be the perfect exit strategy.

• A business partner is an obvious choice for exiting the business. The partner knows the business and its potential. One of the biggest problems is agreeing on a valuation. Outside valuations or offers from others can help determine a fair price. If you have a partner, the valuation process should be established in a buy-sell agreement long before the sale of the business is contemplated.

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For additional information regarding Florida business sales, acquisitions and valuations, please contact Eric J. Gall at info@buysellflbiz.com or 239.738.6227. Also, visit our Florida Business Exchange website at www.fbxbrokers.com and my personal website at www.buysellflbiz.com.