Selling Your Business
Why appointing a part-time FD can unlock the value in your business
If you want to get the best value from exiting your business unfortunately this requires a considerable amount of planning
Attempting to do otherwise could see you end up receiving a fraction of what you should have or need. Without proper exit planning, you could be left with nothing.
Our part-time FD team have a considerable number of years’ experience in dealing with mergers and acquisitions.
They collectively know what it takes to prepare a business and a business owner for exit and they know what it takes to extract the best value in an exit situation.
They also provide senior management continuity throughout any exit process, ensuring organizational knowledge and expertise is transferred to the new owners or ownership structure.
To plan and extract the best value, the whole business exit process starts with a number
There are generally four stages in a business exit:
- Deciding How
- Planning
- Execution
- Post-Exit
Deciding How
There are many ways to exit a business and at the end of the day it ultimately comes down to what the owner wants to achieve.
Deciding how you wish to exit and what those exit goals are will drive the exit method and the exit plan.
It is really imperative to stress that the single most important aspect of any exit is the planning preparation and execution. When this is not done properly it is the single reason why the exiting party fails to achieve what they wish.
There are a number of alternatives to exiting. The most common is seen to be a business sale, however there are other options that could be easier, particularly if one of the goals is to create a legacy rather than generate a cash value.
Planning
As mentioned previously the most important step in exiting a business is planning.
Any planning stage starts with goals and objectives. Is it about the money? If so how much? Surprisingly quite often it is not about the money, is about leaving a legacy. If it is legacy what does that legacy look like? What legacy do you want to leave?
There is a fairly famous story of a retail business owner who ended up not selling their business as the purchaser would not guarantee no future redundancies. For them their employee legacy was more important than hard cash.
Execution
When a plan has been developed it is of course the accurate execution that actually gets results.
Having an external advisor, who has no vested interest in the outcome other than your own objectives is fundamental to success. Your part-time FD will keep the plan on track, deal with external advisors to free bandwidth and enable you to continue the day to day important tasks.
Depending upon your preferred exit route advisors, such as lawyers, business brokers, corporate finance specialist’s and tax accountants will all potentially need accurate up to date financial information showing potential owners that they could benefit from continued growth. There may need to be funding raised in a MBO/I or VIMBO/I scenario, again with a need for expert financial information provided by your part-time FD.
Regardless of what is required, your exit transition will be smoothed by engaging the right level of expertise at the right time.
Post Exit
It is an unfortunate fact that 75% of acquisitions fail at one level or another.
This is a statistic that many acquiring organisations are well aware of, and having the right level of expertise within your senior team, who can help that transition to new ownership can be a considerable benefit.
Client’s Who Trusted Us
I really did not know where to start when I wanted to sell my business, and I felt our Accountants didn’t have the skills to get us the best value and outcome we wanted to achieve.
Engaging FD Executive Solutions gave us the understanding of what we needed to do, how long it would take, and our part-time Finance Director guided us through the process, adding impetus and gravitas to our Senior Management team enabling us to exit with the figure we really wanted.
They also stayed with the new purchaser to make sure the transition was handled in the best possible way. Our exit was longer than we anticipated but we ended up with what we wanted so are more than happy.
I have been thinking about selling our business for some time now, but when we started the process we didn’t know where to turn to, and our accountants weren’t being particularly helpful.
An associate suggested I look to appoint a part-time FD to help prepare the business and I contacted FD Executive Solutions.
Having worked with our part-time FD I now have a clear plan of what we need to do by when to get the best value for when I finally decide to sell.