Are you looking towards retirement? After years of hard work, being able to sell your business for retirement seems like a daunting prospect. However, with some hard work, your efforts will pay off, and you will find yourself settling down for the quiet life. Here are some tips for preparing your business in the run-up to you saying farewell to working life.
Never too Early to Plan to Sell your Business for Retirement
When you set up your business, you should have spent a long time working on the perfect business plan. Now that you are retiring, you should spend as much time as possible working out a retirement strategy. Selling the business will take time, and you will need to be fully prepared to make the sale as quickly and as smoothly as possible. It is not unreasonable to plan for your retirement over several years. The more time you give yourself, the more time you can prepare.
Find a solicitor and a broker who will work for you. It is essential you build a trusting relationship as these are the people who will help you get the best deal. Share your retirement sale plan with them; they may be able to refine it further.
Prepare your team
Ensure your employees are fully updated and onboard throughout the selling process. This is especially important if you are selling an existing business on to a new owner, such as if a café is changing hands. Keep your staff informed and prepare them for their new employer. If they are comfortable and confident, the buyer’s transition period will go smoother for all.
If you took on multiple roles beyond Managing Director, now is the time to expand and hire people to fill the gap you will leave. Restructuring your company might seem superfluous, but it is an important step. You want your employees to be able to work successfully without you, coming up with great ideas and following their own initiatives successfully. A business that can run without you is attractive to buyers as it tells them they will not need to fix any workplace problems you may be leaving behind . The new owner will be able to come in and find their ideal place to settle in naturally among the successful workers you have guided.
Your business has been a significant part of your life for years. It is only natural that you are proud of it and want to achieve a sale that you think reflects your years of hard work and dedication. However, this can hamper your deal. Take a step back and examine your business as a potential buyer would. Any problems you find will need to be fixed. Consult an independent advisor to help you through the process if you are having difficulty. Their insight will help you identify where you need to apply attention.
Even when you have attracted a potential buyer, there are still hurdles to be crossed. Do not get frustrated if a deal falls through. Selling a business takes time and patience. Remember a buyer will want to scrutinise every aspect; if they find something they do not like, they are allowed to walk away without making an offer.
All in the value
If you are not happy with your valuation, there are several approaches you can take to raise it. The most attractive businesses have reliable and consistent financial performance. If yours is not as consistent as you would like, take a look at how to improve it. This plan may include introducing more short-term strategies which can be implemented purely to raise your company’s value.
You can also prepare for the long-term. Write up proposals for company growth over the next few years. While a buyer may have their own ideas about what they wish to do with the company, they will appreciate knowing your vision and may include some of your ideas in their plans for the business.
To keep you comfortable for the years to come, you will need some good investments. Now is not the time for taking a chance with risky proposals. Buy shares in safe and stable options to keep you living the life you want to enjoy.
Remember that you do not have to sell all your shares to your buyer. You can remain with your company as a shareholder and continue to reap the rewards of the success you built.
Have an after-plan
When some people retire, they struggle with going from living and breathing their business to having nothing to do in their day. Look into new hobbies or activities that you have always wanted to do or revisit an old love. Sometimes that still isn’t enough, so consider part-time volunteer work with a charity for stimulating and varied work.
If you were a partner in a law firm or an accountancy practice, remember there may still be work for you on an ad hoc basis. Your clients will have been coming to you for years and may be uneasy at the prospect of transferring to a junior partner. If you are struggling with having a lighter workload, this might present an opportunity for you to do the work you love while still enjoying the benefits of the retired life.
If you are ready to sell your business and retire then why not consider using Hilton Smythe; the UK’s leading business broker.
Try our FREE online Business Valuation Calculator as the first step to achieving your ideal sale.