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Exit Planning Insights
Spring cleaning is good for business
May 4, 2021 / in Exit Planning, Sell a Business / by Al Statz
It’s time for spring cleaning, at home and at work. I only wish my clients did a regular Spring cleaning. It would make due diligence and the whole business sale process a lot smoother. Here’s what I mean: Clean financials: I harp on this a lot. Messy numbers and casual accounting practices create headaches when it comes time to sell. Audited financials, on the other hand, can actually increase a buyer’s offer. Hopefully, you have …
Avoid the Mistake of Selling on Your Own
April 16, 2021 / in Exit Planning, Sell a Business / by Al Statz
One of our former clients, Joe, reflecting on the sale of his company said, “only those of us that have toiled at it know what it really takes to succeed in this business.” How true. Until we risk our own capital and spend years building a team, perfecting products and processes and managing through multiple business cycles, we can’t fully appreciate what it takes to succeed in a given business. Similarly, its hard for business owners, …
8 Situations in Which Setting an Asking Price for Your Business Makes Sense
March 15, 2021 / in Exit Planning, Sell a Business / by Al Statz
As M&A advisors, our objective in most sale processes involving a privately held lower middle market business is to help our client obtain the best price and terms available in the marketplace. In many of our sale engagements, we go to market without an asking price and use a broad or targeted auction format to elicit the best price and terms from multiple suitors. When buyers feel competitive pressure, they are more likely to make …
M&A ADVISOR TIP: What happens to employees after I sell?
March 4, 2021 / in Exit Planning, Sell a Business / by Al Statz
Business owners often come to us concerned about employee jobs and retention issues after a sale. They worry that selling their business will lead to job losses if certain positions become redundant. However, buyers today are often just as focused on retention issues. Your experienced talent can be a key driver of enterprise value, and buyers want to make sure these people stick around. Your management team is the highest priority retention target, and deal …
March 2021 – Now may be the time to sell your business
March 4, 2021 / in Exit Planning, News, Sell a Business / by Roy Martinez
It typically takes 6-12 months (or more) to sell a business. So… if you want to sell your business in 2021, you really need to start now. Selling a business has many steps: 1. Assess the business to establish probable selling price and validate your decision to sell 2. Create a plan 3. Build a business sale team – intermediary (Exit Strategies), attorney, CPA, others 4. Develop market materials – NDA, Executive Summary, CIM (confidential …
Tax changes could accelerate business sales in 2021
January 22, 2021 / in Exit Planning, Sell a Business / by Al Statz
To complete deals in 2021, ahead of possible tax changes, owners and deal teams need to act fast. With the Democrats in the White House and having the tie-breaking vote in the senate, it is likely that taxes on corporations and wealthy individuals will increase during this administration. When and how much are unknown. With COVID recovery as the administration’s immediate priority, many think we will have until 2022. Biden has proposed raising long-term capital …
M&A Advisor Tip: ESG Diligence on the Rise in M&A
January 22, 2021 / in Acquire a Business, Exit Planning, Sell a Business / by Al Statz
Companies that are able to showcase their Environmental, Social and corporate Governance (ESG) capabilities stand to gain a competitive advantage and make themselves more attractive to potential acquirers. ESG issues cover a wide range of corporate practices that could include everything from environmental stewardship, health and safety policies, employee well-being, community support, to corporate culture issues. In recent research from Datasite, 84% of dealmakers rated ESG as an “important/very important” M&A due diligence consideration. And 78% …
M&A Advisor Tip: Be able to articulate your growth story.
December 18, 2020 / in Exit Planning, Sell a Business / by Al Statz
Buyers want to acquire businesses with profit AND growth potential. Where is your business headed? Will it still be relevant in 5 years? Where will growth come from? How will it outperform its industry peers? If you don’t have an expansion strategy at the ready, talk to an M&A advisor or an exit planner. We can uncover which parts of your business are most attractive to buyers. Then we can help you plan to increase …
M&A Advisor Tip: How you know when it is time to sell
December 1, 2020 / in Exit Planning, Sell a Business / by Al Statz
It may be time time to sell your business when … Revenue has plateaued and you no longer see how to grow the business. You’re not sure how to reach the next level on your own. Your industry is consolidating around you. The current probable selling price of your business will satisfy your personal financial goals and a major economic or political shift could erode value. You’d like to diversify your assets and are ready take …
Better to sell early in consolidation. Here’s why.
November 11, 2020 / in Exit Planning, Sell a Business / by Al Statz
Consolidation is inevitable in maturing industries. As an M&A advisor working with owners of private wholesale distribution and manufacturing companies, one of the questions I get asked is whether it is better from a valuation perspective to sell early in a consolidation phase, or hold off. My answer is always case-specific, but generally earlier is better, all else being equal. Before I explain why, I want to point out that industry consolidation is not always …
Exit Strategies Group, Inc. is a leading provider of business sales and acquisitions, business valuations, and exit planning services for family owned and closely-held companies since 2002.
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