Exit Planning and Business Valuation

Exit Planning and Business Valuation

Exit planning is a simple concept. It is the idea that business owners probably will, at some point before they decide to sell or transfer their business, do some planning around this critically important event. Owners should know and make plans around issues such as the value of their business, getting the conversation started, and measuring the owner’s readiness for an exit. They should consider who would likely want to own their business, when they might expect to get paid for the business, and whether that would be enough money. There are likely to be other critical issues and strategies necessary to achieve a successful exit.

Exit planning is a process that often requires in-depth analysis, and an extended period of time, possibly measured in a year’s time, to complete. It is usually thought-intensive, and heavy on running what-if scenarios, to find the optimum result. It might involve as many as a half dozen or more specialists, sometimes called a cross-function transition to advise on the various aspects of the plan. Several of these are indispensable, including a transactional attorney, and probably a tax advisor, a valuation analyst, an investment advisor, a retirement planner, an estate planner, and others.

Managing member, Mark C. Frey, has experience in exit planning, which extends over thirty years. He has assisted a number of business owners in navigating through the process. He is a Certified Exit Planning Advisor, and for almost twenty years was a Certified Valuation Analyst. He continues to stay abreast of both the tax effects of selling a business, and the evolution of the valuations aspects of negotiating a business sale. See the Tax and Legal Solutions tab of this website for a discussion of his qualifications in these areas.