17th November 2015
Planning your successful exit
Whether it’s to pursue other interests, have more time to yourself, or to retire, the day will come when exiting your business becomes a reality.
So here’s our 3 point GPS plan for maximising the value of your business:
Grow it, Polish it, Sell it
- Focus on improving profit – Improve your margins, eliminate inefficiency and strip out unnecessary costs
- Create clear, long-term growth plans – Prepare strategic plans for sales and marketing to increase the level of activity, the quality of customers and the strength of the pipeline
- Instil confidence in a buyer – Ensure the business has robust financial and operational management, with sound forecasting and reporting processes, and relevant KPIs (Key Performance Indicators) that provide a clear dashboard of both the past and the future
- Lock in revenue – Maximise the proportion of income that arises from long-term arrangements, such as maintenance/service contracts, rolling contracts and retainers
- Make yourself dispensable – Reduce the amount the business relies on you, as the owner, for generating new sales, servicing key customers and technical know-how. And, of course, running the business – so spend less time on day-to-day activities
- Clean up the finances – Reduce debt, draw out surplus cash, remove private assets and non-core expenditure
- Reduce the risks – Reduce your dependency on key customers, suppliers and, internally, individual members of the management team – view risks from the buyer’s perspective
- Identify the value – The worth of the business hinges on how much profit the buyer can make from it. Identify where future growth is likely to come from and the intangible benefits the purchaser will acquire
- Find the right advisers – for the business and the owners – Choose an advisory team, with a proven record, that can guide you through the many legal, tax, financial and regulatory issues and, most importantly, are people you can work with
- Get the timing right – Ensure the timing is right both for you, as the owner, and the business
- Anticipate objections – Be ready for likely objections raised by potential buyers and their value-reducing tactics, using your advisers to help you prepare and negotiate
- Be prepared – Be ready to move on if you sell, and prepared not to sell if it doesn’t feel right (for whatever reason); having a strategic contingency plan strengthens your position. And be ready to consider an earn-out arrangement
At some stage, as the owner of a business, you’ll want to get out.
What our clients say
Malcolm is an excellent Senior Financial Executive. Malcolm knows pretty much all there is to know about investment management and the market. I have known and worked with Malcolm for many years and h...
Malcolm Lay and his team at Sovereign® Employee Benefits have administered the Company Pension Scheme and benefits package for 15 years and it has been run smoothly and professionally for...
Dann & Co
I recently engaged Sovereign to assist me with the set up and implementation of our new Workplace Pension Scheme as require...
Langstone Engineering - Toolmakers and Precision Engineering
We are a commercial cleaning company who had reached our staging date and begun the Auto enrolment process. This was a new and very alien situation for us and after admitting defeat searched for assis...
Moores Cleaning Services Limited
I have used the services of Sovereign® Employee Benefits for the past four years and would highly recommend them to oversee company benefits. Quality and effectiveness of communication hav...
We are a sailing club based on the Isle of Wight and found our obligations for the implementation of a suitable Pension Auto enrolment scheme to be a somewhat daunting prospect. Having engaged the ser...
Sea View Yacht Club
We signed up with Sovereign to support us with Auto Enrolment and what seemed like a daunting task was made easy by Jackie and her team.
SeaSafe Systems Ltd
I have worked with Sovereign for a long time and they have always given good pension advice and as my confidence has grown over the years I have now made substantial financial investments outside of m...
I have worked with the team at Sovereign® Employee Benefits since 2006 when they were appointed to administer our existing Defined Contribution Occupational Pension Scheme. Since our assoc...
We are in the first stages of “Auto Enrolment” and I can honestly say that Kirsten has been extremely helpful in answering all my queries (and I have had quite a few the last week). She has answer...
For many years I have been advised by Malcolm Lay, the Director of IFA (South) Ltd I really value, extremely highly, the personal nature of the service I receive from such an experienced and senior...
Macallan Penfold - Chartered Architects
Having been a business owner for 20 years plus I have been very impressed with the depth and detailed knowledge Sovereign® have provided me and the business. They have also advised myse...
Sovereign have acted as administrator of our final salary pension scheme for a number of years. Donna Ayrton at Sovereign...
I have worked with Malcolm and the team at Sovereign® Employee Benefits for several years now and they are currently appointed to administer our existing Group Personal Pension and our Gro...
Dean & Reddyhoff Limited
Over the past three years Sovereign and their adviser Paul Howorth have provided sound friendly advice on a number of financial matters from pensions to protection to both us personally as Directors a...
Coil Maintenance Ltd
I have used the services of Malcolm and Sovereign® over the last 20 years in both the business I have managed and as my own personal financial advisor. From a business perspective they hav...