Exit Planning
Many business owners wake up one morning and think to themselves, “I should sell my business!” Deciding to sell is easy. Making sure that you are ready to sell is another matter altogether. Chances are, this is your first time selling a company. The problem is there are many issues between the thought and the action of selling your business that can derail your dreams along the way.
Crossing The Goal Partners specializes in guiding business owners through a process that will increase the value of their company and increase their chances of Getting Full Value when they sell.
We guide business owners using our Build-To-Sell or Exit Strategy Roadmap. This roadmap puts clients into the best position when they decide to pull the trigger and sell their company. Creating an exit strategy can take as little as one year to complete. although in some cases it has taken longer. With that said, no matter how long it takes it will be well worth the time when the value of your business is significantly improved.
Look In The Mirror
The first thing we must do is understand both your personal attachment to, and health of your business. We need to take a good look in the mirror and really see what is there. We do this using two very specific tools, our Personal ReadinessTool and the Value Builder Healthy Business Tool.
Your strengths. From financial performance, revenue model, and cash flow to customer satisfaction, and owner/operational dependency, we cheer the exceptional work you’re doing as an entrepreneur and review what might be holding you back from getting to the next level of success and value in your business.
Your team. What are the key characteristics you desire from those on your team, what critical actions must they execute to move the needle and add to the success you’ve already achieved? Does your team get it, are they inspired to do it, do they have the knowledge, resources and capability to execute? Do you have the right people in the right seats?
Your clients. Who are you doing business with today? Are they promoters of your work? What strategies might we craft to improve customer satisfaction from a 9 to a 10. Can we calculate the lifetime value of your best customers?
Your Scoreboard. Good news, your Readiness and Value Builder Business Health reviews are a baseline; we now know where to start, what to measure, and how to build a game plan to help you cross the goal.
Imagine The Future
Taking steps to grow your company begins with imagining the future in a realistic way. Business owners need to take a few steps back and look at their business objectively and re-imagine the future
Ten Year Vision. Before we can plan the end game for your business, we need to establish your personal, future vision. Who will you become next – after being a business owner? Establishing a personal mission and future vision are key to avoiding the depression and regret 75% of business owners experience within one year of exiting their business.
Start to consider who you will be in your next chapter of life – what will you do with those 60 hours you used to spend at work? Let’s have that discussion.
Right Team in Right Roles. Review the structure of your organization and leadership team, consider potential successors. If your strategy is to sell and exit, the future owner will certainly appreciate and reward you for having the right team in the right roles doing the right work. Ensuring operational continuity during the transition benefits you and your successor.
Your clients and suitors. We help our clients identify their “ideal customers” and target market. Supporting future sales is key to ongoing revenue and profits. Before you can consider selling or passing the business on to the next generation of owner, we’ll craft a picture of who could be an ideal acquisition partner – strategic and financial buyers are motivated by slightly different objectives. Let’s figure out who’s in your market.
Kicking things off. Every engagement begins with an introduction interview. We’ll say hello, get to know each other a bit, and determine if there is value in moving forward to the “Assess and Address – Discovery Session.” If not, we’ll stay friends, keep in touch, and support each where and how possible. If so, we’ll craft a schedule and determine a suitable meeting rhythm to include an agenda and action plan with resources to help you grow a healthy business of value.
Develop A Game Plan
Without a game plan the team will fumble. The Bible says it this way, “Where there is no vision, the people perish.” If there is no game plan or if the game plan the team is using is ineffective then it is time to develop a new one.
Prioritize Problems; Address Challenges. There are hundreds of challenges that flood into any business every month. There is no way to deal with all of them but if the team will take some time to prioritize these challenges then they can become manageable and progress can be made. Let’s create a proactive environment of fire prevention rather than one that’s reactive to fire-fighting.
Short-term wins. The path to your successful exit is played in a field with lots of blockers, Focus on your first ten yards, each play moves you down field a few yards at a time; create a set of short-term successes you can celebrate that keep the offense on the field and motivated to cross the goal.
3-Year Focus. Let’s reverse engineer your vision with a focus on the future. What projects are on the improvement roadmap? Let’s focus on the efforts that support your vision of creating a healthy business of value and a successful exit. This focus creates a powerful image of the future and helps everyone work towards the same vision.
1-Year Plan. Outline your objectives for the year to come by identifying and crystallizing your revenue targets, profit targets, and leading indicators of measurable success , along with your top three to seven goals. Develop SMART Goals which are Specific, Measurable, Attainable, Realistic, and Timely. Implement the routines and habits to accomplish the job.
Align Team Direction. The Three Year Picture and 1-Year Plan will order the steps of the entire team so that everyone is operating out of the same playbook as they follow the plan to a successful end game.
Right People In Right Seats
John Maxwell says, “Everything rises or falls with leadership.” This is true and having the right people in the right seats on the bus makes all the difference if you want to get to the right final destination.
Build Team Health. If the company is going to preform properly then everyone needs to be healthy and able to plan their role. Team health has both individual and group applications. The team needs to be able to operate in an open and honest atmosphere so that everyone can identify, discuss, and solve the issues that come up without fear of repercussions.
Develop Responsibility Chart. This chart clarifies responsibility for the company. Different from an organizational chart, a responsibility chart defines the right structure for your company and clearly identifies who is accountable for what.
Employ Team Survey . This is a simple tool that pulls your Core Values and Responsibility Chart together to help your organization identify if they have the Right People in the Right Seat.
Watch The Scoreboard (Measure Data)
Without a Scoreboard, no one knows who is winning the game. Scoreboards show us how well or how poorly we are doing. Sometimes business owners are so busy keeping up daily demands that they do not take time to look at the scoreboard. This is a deadly mistake.
Determine What Absolutely Needs to Be Measured. Measured results are important if you want to know if you are winning or losing. Business owners do not need to measure everything, but they do need to measure the important metrics. Owners need to determine and then measure what is important to develop an effective scoreboard that measures success or failure.
Set Up Scoreboard. These important measurements need to be set up in such a way that it is easy to evaluate success or failure with a quick glance. Tracking a handful of numbers that give you a pulse on your business is all that is needed. However, these numbers need to be easily seen by the leadership team.
Keep Score. Having a scoreboard is one thing, keeping score is another. If the team never looks at the score or if they never really care about what the score is then the company is headed toward failure. Knowing the score and allowing the score to make a difference in the behavior of the team is very important.
Document The Process
Systemizing your business by identifying and documenting the core processes that define the way to run your business increases the success and the value of the company. This process, while sometimes tedious, is well worth the effort because it provides clarity and ultimately value when you go to sell your business.
Determine Most Important Processes. Every process does not have to be documented; however, the most important processes do need documentation. Accounting, marketing, sales, operations, and human resource processes may be important to your business but identifying your handful of cores processes is key.
Document the Steps. This can be done by using a Process Documentation method. 1) Give each process a name that everyone agrees upon, 2) record the major steps in each core process, and 3) package each core process in a way that is easy to find.
Commit to Follow Process. All the work above will not benefit anyone unless the leadership team and the whole company make a commitment to follow the process. This will require training, supervision, accountability, and a commitment to fellow team members. This commitment will lead to success on multiple levels within the company.
Honest Reviews
Open and honest evaluation on a regular quarterly basis is an important component to the success of the business. Everyone wants to be successful, but few will take the time and make the commitment to be successful. Honest review moves any business further down the path of success.
Identify Critical Issues. Strengthening your company’s ability to identify issues can only take place if there is interpersonal transparency within the leadership team. When team members are afraid of looking bad, they will often ignore issues that are damaging to the business to “keep the peace” and not bring up issues that may produce conflict. Ultimately, conflict is our friend, and everyone needs to be able to speak freely to help the company identify real issues that are damaging.
Dig Deep Around Why. Once an issue has been identified then the whole team needs to openly discuss the reasons that may be causing the problem or issue. This can be done within the context of a “healthy” team that is seeking to address the issue on the way to solving the issue forever. Sometimes this can take some time but if a company is going to be successful then it is time well spent.
Agree on Solution. Several different solutions to the issue might be discussed by the leadership team but in the end, the team needs to agree on the solution. A healthy team will walk out of a discussion session with a commitment to one way to solve the issue. This not only builds the team it builds the morale of the entire company.
You Need A Team
“Most business owners know everything about their business, the good and the bad. They’re experts in their industry, dealing with the highs and lows every day.
But when it comes to selling their business, it’s a whole different ballgame. Selling a business is a unique process, and most business owners are in the dark about it.
That’s where your team of advisors come in. They’re experts in the sales process. They help business owners make the right decisions at the right time and avoid costly mistakes.
Your team should guide you in setting and negotiating a realistic price/value for your business, navigating the tax and financial implications of a sale or ownership transition, help protect you with appropriate legal guidance and transfer/mitigation of risk, etc.
