Tag Archives: Business for sale in Minnesota

Case Study: Real Estate Services

The Opportunity

In the mid 1980’s, an enterprising young farmer couple saw a need and capitalized on it. One of the many responsibilities on real estate agents’ plates is signage: putting signs in yards for listings and removing them after closings. This young couple started marketing this signage service for a fee and their business took off. Real estate agents were delighted to financially compensate this couple in order to offload this tedious task.

Sale #1

In a short span of time, their business was booming to the point where it was interfering with farming so this couple contacted Opportunities in Business about selling their startup. They sold the business to another farmer who went on to grow it by adding more realtor-oriented services such as storing signage, painting sign posts etc.

Sale #2

After a few years, this farmer and second owner decided to sell the business and contacted Opportunities in Business. With the help of OIB, he sold the business for 4x the original sale price. Realizing his passion for buying and selling businesses, the seller then joined the OIB team as an agent.

Sale #3

A few years after acquiring the business, this third owner was diagnosed with a serious medical condition and was no longer able to maintain it. He reached out to OIB and together we sold it for double what he bought it for.

Opportunities in Business had the privilege of selling this business a fourth time – this time for over 10x the original sales price. By this time, the business enjoyed over 65% of the market share statewide.

This is just one of many real life examples of how Opportunities in Business harnesses our experience in real estate to the tremendous benefit of each of our clients.

Case Study: Legal Subscription Service

While Opportunities in Business usually just helps people sell businesses, we often tell the story of when we helped create one. It happened when Bob Griesgraber and Tom Green, owners of OIB, learned of a change taking place at the Minnesota Supreme Court.

Court Provides Documents to Law Firms

It was the early 1980’s, before the digital revolution, and like many enterprises the court system generated vast quantities of documents. Some of these papers documented important changes in the law at local, state, and federal levels each year.

Historically, the Minnesota Supreme Court administered this information. A team of three employees were in charge of organizing these documents, which they compiled in three-ring binders. The court itself relied on these records, and attorneys and law firms also needed to stay up-to-date on these changes in the law. When legal professionals needed access to the information, they requested copies and paid a fee for the service.

Court Divests from Business

Eventually, the court concluded it was inappropriate for the courts to engage in this for-profit activity, and proposed that the enterprise no longer continue under the auspices of the court.

Griesgraber and Green got wind of this effort to privatize this vital service, and recognized the value of it. Here was an existing system satisfying an existing need for an existing market.

Meanwhile, they knew of someone seeking a new business to run. A local accountant (full disclosure: the accountant for Opportunities in Business) had an underutilized office and an underutilized wife. The wife had the skill set to manage such a business, and they had asked OIB to be on the lookout for a business which would be a good fit.

Family Buys and Expands Business

The wife-and-husband team bought the “business” for less than $50,000. They improved the systems by refining the collection and codifying the information, assembling it into a handbook for lawyers. Annual subscriptions were offered to the legal community, which responded positively: within a short time most law firms in Minnesota subscribed. Then they expanded to other states.

OIB Helps Family Sell, Very Profitably

Within seven years they had grown to 13 states. Ready to downsize their stake in the business, they asked OIB to sell about 80% of the states’ copyrights interests. OIB found qualified buyers and made the deal, netting well over a million dollars. They also sold the accounting practice.

With OIB’s help, this talented team got into a fledgling business for a relatively small investment. In seven short years, they boosted the business value by a factor of over 20 times. When they were ready to step back from their project, OIB was on the job again, helping them capitalize on their investment.

Why CEOs Must Take a Granular Approach to Overseeing Sales

CEOs have broad, big-picture responsibilities. While responsibilities will vary from firm to firm, CEOs typically rely on a number of division heads to manage the details while they take a wide, long-term view.

Why A Granular Approach to Sales is Important

While being a good manager and delegator is key, there’s a valid argument that CEOs need to take a more granular view of sales. McKinsey, a global management consulting firm, concludes that “CEOs who prioritize sales management outstrip their peers by as much as 80% in terms of revenue and profitability.”

80% — that’s quite a margin. What fuels this success?

Predict Revenue More Accurately

A CEO who takes a hands-on interest in monitoring the sales pipeline will be better positioned to predict revenue more accurately, and more effective at taking action to improve sales outcomes or revise expectations. Sustainable growth depends on both of these factors. Further, having firm numbers to reflect sales functions is crucial to attracting interest from venture capital.

What Sales Number Does a CEO Need to Track?

Every leader needs to resist falling down the rabbit hole of micro-managing, so what sales numbers does a CEO need to closely track?

Michael Sala, managing director at private equity firm LLR Partners, identified four sales pipeline metrics CEOs should monitor in a recent article.

His advice: Know the answer to these four questions:

  • What’s our average deal size?
  • What’s our average sales cycle?
  • What’s our conversion rate?
  • How many leads do we need in the sales pipeline?

What’s our average deal size?

Calculate the average deal size of your closed won deals over the last 12 months. Let’s say the average deal size is $50,000 and you intend to hit $2 million ACV. In July, the sales team would have to close 40 deals to hit the target.

What’s our average sales cycle?

Asses the time it takes to move from creating a qualified sales prospect to actually closing the deal. Check out data from your CRM and calculate the average from the last 12 months. Apply that number to what’s actually in your sales pipeline to anticipate what is likely to close in the year.

What’s our conversion rate?

Once again, rely on your CRM to assess your past conversion rate. If your rate is 10% and you want to close 100 deals, you need 1,000 opportunities in the pipeline.

How many leads do we need in the sales pipeline?

This one’s a bit trickier, because it varies across different lead-generation channels. Client referrals might have a high conversion rate, while leads generated by automated emails might be a fraction of the rate. So apply the conversion rates channel by channel—you ARE tracking how you got your leads, right?—to calculate how many leads you need to get the conversions you require.

Revenue Forecasts Based on Concrete Data

By having a handle on these metrics, you demonstrate to potential investors and buyers that your revenue forecasts are based on facts and past performance, not wishful thinking. Keep an eye on these figures, and you’ll know when the pipeline isn’t supporting projections, at which point you can step in to correct the situation.

When buyers have confidence your revenue is predictable, that translates into confidence in your business. When CEOs can state specific figures backed up by fact, they’re in a much stronger position than if they offer general ball-park figures.

Even if you’re not focused on attracting investors, it’s still a valuable strategy for scaling up your business. If you’ve got questions about buying or selling your business or how a granular approach to sales can help increase your business valuation, please give us a call!

Differentiation Defies Simple Price Concerns

Let’s talk about the “commodity trap”: Basing your competitive position purely on pricing considerations. It’s the first step in a race to the bottom. While it’s true that price is often the top concern expressed by customers, it’s crucial to dig a little deeper.

Bain and Company, a global management consulting firm, surveyed B2B consumers of IT infrastructure products. Their analysis, described in an article in the March/April 2018 issue of The Harvard Business Review, demonstrates that these B2B customers identified cost reduction as their stated priority, but their responses to a series of questions indicated otherwise.

Bain identified 40 factors which mattered to customers. “Product quality, expertise, and responsiveness emerged as the strongest predictors of customer loyalty,” the article states. “Cost reduction was not even among the top 10.”

The 40 factors Bain cited represent a complex assortment of qualities which range from the very rational and objective (such as price and performance) to much more subjective and emotional factors (such as aesthetics, reputation and social responsibility). Bain grouped them into five categories: Table stakes; functional; ease of doing business; individual; and inspirational. Next, they assembled these considerations into a five-level pyramid in which strictly objective value forms the base and elements increase in subjectivity as they ascend the pyramid, in the style of psychologist Abraham Maslow’s iconic Hierarchy of Needs.

Pyramid of Value Spanning Five Categories

The bottom layer, the foundation of any product, are simply “table stakes,” meaning the bare-bones basics. This foundation depends on “meeting specifications at an acceptable price in compliance with regulations while abiding by ethical standards.”

Level two includes functional elements, and businesses often focus much energy here. These factors relate to economic or product performance needs, such as cost reduction and scalability.

At level three, we start seeing subjective considerations. Along with objective goals like time savings, reduced effort, simplification, organization, we find subjective judgments from buyers, such as a good cultural fit and a seller’s commitment to the buyer.

Level four is increasingly subjective, including elements of taste (appealing design and aesthetics), big-picture concerns (increased marketability or network expansion) and personal considerations (reduced anxiety).

Level five crowns the pyramid with suitably lofty notions: Vision, social responsibility, and hope.

Buyers and Sellers Must Compete on All Levels

As business brokers, OIB considers this information to be of prime importance. It is (or should be) a game-changer to parties on both sides of a transaction.

If you’re selling a business, accept that savvy buyers recognize a business can’t thrive by simply dominating the bottom layer of the pyramid. You’ve got to work on identifying, quantifying and competing on the more subjective items in the pyramid. The good news is: This will make your business more attractive to buyers precisely because it’s a crucial strategy to build customer loyalty, so your efforts will be doubly rewarded.

If you’re shopping to buy a business, do your due diligence. When evaluating a prospective business, study whether the executive team recognizes the importance of appealing to customers on every level of the pyramid. If a business settles for competing strictly on table stakes, they’re missing the boat. True, these elements are simple to measure and fairly transparent. It’s easy and tempting to simply compete on these, and they should not be neglected. However, today’s battle for differentiation takes place higher up the pyramid.

Admittedly, it’s harder to evaluate a business based on those increasingly subjective and intangible factors, just as it’s harder to actively pursue them. The fact remains that they matter enormously to customers, so they should matter enormously to you.

Selling to a Competitor

When you put your business up for sale, you’re bound to attract interest from your competition.

It makes perfect sense. They have a variety of legitimate reasons to be interested in your company. They may be hoping to benefit from your technology, your patents, your employees, your contracts, your existing market share. When they’re on the up-and-up, your competitors absolutely deserve consideration as potential buyers.

However, there’s a risk that they’re not genuinely considering a purchase, but actually using your “for sale” sign as a spying opportunity. We’ve all been “looky-loos” at some time in our lives: popping into a neighborhood open house or test-driving a dream car. However, when your business is the product and the competition wants to metaphorically open the closets and inspect the basement, you need to make sure that they’re seriously considering the purchase, and that you don’t share privileged information with them until the deal is signed.

Worst case scenario: Your hot prospect competitive buyer was only pretending interest, and they succeed in accessing information which makes them an even stronger competitor. Worse yet, if they successfully act on their new intelligence quickly, that might further hinder your ability to sell and command the price your deserve.

However, since part of the diligence and buying process involves the sharing of potentially sensitive data, stonewalling your buyer shouldn’t be your go-to response. Treading carefully is essential. Here are some questions to consider.

Do you even want your competition to know that you are trying to sell?

This question represents the ultimate balancing act. There are plenty of strategic reasons to keep your intention to sell on the down low, especially in regards to your competition. In fact, unless they are good buying candidates, your business is probably better off if they don’t know. Make a list of your competitors and try to understand whether they’d consider buying your business a welcome opportunity. Use your insider knowledge to try to determine what they’d value most about acquiring you, and what they’d value least. Also, consider your existing relationship with them. If you’ve got a courteous relationship of mutual respect, there may be more reason to trust them. If things have been ugly in the past, don’t expect them to get better in the course of acquisition negotiations.

How Can You Assess Whether They’re Legitimately Interested or Simply on a Fishing Expedition?

Consider their track record. If they’ve got a recent history of acquisitions, their interest is more likely to be legitimate. If this is their first apparent foray into acquisitions, they might have darker motives. Similarly, a genuine buyer is likely to have a team or specialist devoted to M&A. If they don’t, that’s another potential red flag.

How Can You Share Enough of the Right Information, Without Putting Your Business at Risk?

Here’s what Barbara Findlay Schenck wrote in Selling Your Business For Dummies:

If you feel a competitor is truly serious, treat it as a hot prospect but proceed carefully. First, be sure to obtain a mutual confidentiality agreement. Then request buyer background information before sharing further information on your business. This information exchange allows you to determine whether the competing individual or business has the capability to purchase your business and it also provides a good test of the competitor’s motivations. A competitor who’s simply fishing for information about your business won’t be interested in sharing confidential personal or business information and that alone will provide the answer to your question about how to rate the validity of the inquiry.

A Competitor Can Be a Great Buyer

Your competition can be a rich source for strong buying candidates. They may be willing to pay top dollar for a strategic acquisition, and the possibility of eliminating competition could be very attractive to them. A competitor may realize they can acquire you and eliminate many of your fixed costs thanks to an economy of scale, which means your business is worth more to them than to a non-competitor. However, the risks are considerable, so we urge caution. Evaluate them carefully and make sure you’re getting good advice from your own resources as you explore the prospect.

Do you have questions about buying a business or selling a business, give us a call?  We’re happy to help! We can be reached at 612.331.8392 or by email at info@oibmn.com.

Meet our team: http://oibmn.com/our-associates/

See our latest listings: http://oibmn.com/listings/

Confidentiality: How to Maintain it During a Business Sale

How can a broker help you maintain confidentiality in a business sale? 

When you decide you’re ready to sell your business you may have concerns about keeping the sale on the down low. If word about the sale gets out among creditors, customers, employees, competitors or vendors, it could trigger a host of negative reactions and unrest and could potentially decrease the value of your business at a time when maintaining its value is a top priority. The most secure way to navigate the sale of your business is to enlist a broker. Brokers have a number of systems in place to safeguard the confidentiality of your transaction.

Using Teaser Descriptions to Market Your Business

When advertising your business for sale, a broker will create a “teaser description” of your business. This description will contain enough information to pique the interest of potential buyers without revealing the identity of your business.

Pursuing Buyer’s Qualifications

After reading your teaser description, when a company or an individual express interest in moving forward in the purchasing process, the next step is to pursue buyer qualification. This means requesting financial information that demonstrates the potential buyer’s ability to secure the purchase of your business. Fortunately, your broker will navigate these waters for you. If the interested party is unable to provide a proof of funds then you are out nothing and the identity of your business is still under wraps. However, if the interested party demonstrates purchasing capability, you can confidently move forward in the process by entering into a confidentiality agreement. 

Trending: Happy Holidays banner from 1DayBanner

Using a Confidentiality Agreement

A confidentiality agreement is a document your broker will have on hand. Once you determine that the interested party is financially-qualified, they will sign the agreement. This signed agreement protects your business if they break confidentiality and it serves as a portal through which you can divulge your business name and other private company information.

Maintaining Open Communication

Throughout this time, your broker will encourage you to maintain open communication with your management team. They will also orchestrate meetings that include your upper-level management. Keeping upper-level management in the know will give them time to mentally prepare for this transition and it will demonstrate that you value them and recognize the value they contribute to your business. It can also help curb the internal spread of rumors regarding the sale.

Creating Blind Methods of Communication

There’s obviously going to be a substantial amount of communication with prospective buyers about the sale of your business. Your broker will create blind methods of communication – email, phone number, voicemail… –  as an easy way to protect the identity of your business.

On account of the level of confidentiality required, holding meetings off-site is a smart way to avoid the rumor mill. Your broker’s office is a safe place to engage in private discussions regarding your transaction.

The sale of a business can be challenging to navigate, particularly where confidentiality is concerned. Enlisting a broker to facilitate the transaction is a wise decision – one that will protect your confidentiality, reduce your stress level and provide immense value throughout your entire transaction.

Do you have questions about buying a business or selling a business, give us a call?  We’re happy to help! We can be reached at 612.331.8392 or by email at info@oibmn.com.

Meet our team: http://oibmn.com/our-associates/

See our latest listings: http://oibmn.com/listings/

Demystifying How Business Brokers Get Paid for Buying or Selling Businesses

Finding a business to purchase apart from a business broker can be incredibly challenging. Selling your business on your own does not make sound financial sense. The amount of value a business broker provides outweighs the amount they charge in fees every single time. It’s important when navigating the purchase or sale of a business to carefully consider all aspects of the process – from finding or advertising your business to securing the right buyer to closing the deal –  recognizing that a business broker can assist with each of these components. It’s also important when hiring a business broker to understand their fee structure amid common misconceptions.

Success Fees

A standard fee your business broker will charge is incurred upon the sale of your business. This is called a success fee. This fee is typically calculated as a percentage of the final transaction price. For middle market transactions, the fee is anywhere from 2-5% of the sale price. Because this fee is only paid out when a deal closes, your broker will be highly motivated to close the deal, aligning their motivation with your own.

Business Valuations

In some situations, a business broker will charge a potential seller for a business valuation. If the seller then chooses to list with that broker the fee will be credited against the success fee at the end of the transaction.

Intensive Search Processes

When a buyer hires a business broker to help them find a business to purchase, that buyer will likely incur a charge for the intensive search process.

Alternative Fee Structures Are Available

In some situations, a business broker will consider an alternative fee structure. In a case where the broker is representing the seller, it might be a flat fee up to a certain sale price and a percentage beyond that. In very rare cases a seller and broker might agree upon an hourly rate. It’s important to discuss the fee structure up front so everyone is on the same page.

Business Brokers Provide Value

Business brokers provide tremendous value for their clients. Not only do they possess the resources that often help secure a business for their buyer to purchase or bring active buyers to the table for their seller but they also help navigate what can be a daunting and stressful process and are highly motivated to work hard on their client’s behalf.

If you would like to learn more about the fee structure of business brokers or would like to speak with us about buying or selling a business, we would love to connect! We can be reached at 612.331.8392 or by email at info@oibmn.com.

Meet our team: http://oibmn.com/our-associates/

See our latest listings: http://oibmn.com/listings/

What Disruptors Can Teach

WHAT DISRUPTORS CAN TEACH

Disruption: it’s usually a script in which an innovative upstart overthrows an established firm. While it’s nothing new — fossil fuels disrupted the whale oil industry a few centuries ago — it’s now happening at lightning speed. Technology is partly responsible: As computer processing power grows exponentially, the realm of what’s possible broadens. Technology might be indirectly responsible in other ways, such as improving communication and making information available to the disrupting forces.

Offense Vs. Defense

Arguably, it may come down to offense vs. defense mentalities. The 800-pound gorillas of business are operating on a defense model: They’ve got lots to risk, so they can’t escape their vested interest in the status quo. Disruptors are on the offense: They’re smaller and nimbler, so it’s easier for them to change tracks.

In a recent article on ChiefExecutive.net, editor emeritus J. P. Donlon considers the dynamics of disruption, and observes that the key to success for incumbent companies is their willingness to disrupt themselves. Digging into existing models and strategies didn’t work for Blockbuster — disruptors like Netflix were rewriting the playbook.

It’s also worthwhile to examine the example of counter-intuitive disruptors: those who disrupt by returning to tradition. An over-simple illustration: Watchmaking was once the domain of a skilled echelon of craftspeople. Technology turned watch-making into a mass production factory endeavor, and eventually, companies like Shinola took the process full circle, hand assembling expensive timepieces in Detroit.

Have the Courage to Disrupt Yourself

Instead of trying to protect your traditional way of doing things, ask whether you can serve the customer better by disrupting yourself, and seizing the offense instead of playing defense. One of the great powers of social media is the window it offers on the customer experience. By actively surveying customers’ perspectives, you can understand their needs and what they perceive as shortcomings in the existing model.

Author Donlan invites you to ask yourself these questions:

  1. When was the last time you rolled-out a new product?
  2. When was the last time your business embraced change and did something innovative?
  3. Does your organization focus more on process than success?
  4. Are your management and executive ranks void of youth?
  5. When was the last time you entered a new market?
  6. Are any of your executives thought leaders?
  7. When was the last time you sought out a strategic partner to exploit a market opportunity?
  8. Do you settle for just managing your employees or do you inspire them to become innovators?
  9. Has your business embraced social media?
  10. When was the last time your executive team brought in some new blood by recruiting a major player star?

We hope you enjoyed this article. Learn more about our team of experienced business brokers! 

Selling a Business: Overcoming Obstacles

Selling a Business: Overcoming Obstacles

Selling your business: whether planned or unexpected, it’s a big deal. It’s no surprise owners face a variety of practical and emotional obstacles when they entertain the prospect. These obstacles vary widely for personal reasons.

Roughly speaking, there are two ends of the spectrum. Entrepreneurial types enter the business with notions of building a profitable company in order to sell it in the relatively near term. Passion-driven owners typically start and grow a company for long-term operation and profit. Selling the business might not be part of their plan: for example, they expect it to stay in the family. However, circumstances may change, so they should always keep the option of selling in mind.

When faced with the prospect of selling, what obstacles arise, and how can savvy owners overcome them? Here are a few which both entrepreneurial and passion-driven types should consider.

Fear of Selling at the Wrong Time

Timing is a personal matter. When a passion-driven owner says “the profits are great, why would I sell now?” an entrepreneur will say “the profits are great, so it’s the best time to sell.” Of course, either one might face family, health or financial issues which dictate an unexpected sale. So keeping your operations honed and profitable always pays, and recognize that a certain degree of uncertainty is inevitable. Just like you can never know when the perfect time has come to sell a stock or a home, you will never know the perfect time to sell a business. All you can do is keep an eye on the big picture in the context of your industry, and keep your company as lean and efficient as possible.

Fear of Under-Pricing

Most sellers react to this fear by over-pricing, which keeps a business on the market too long, which further jeopardizes its salability. It’s crucial to undertake a thoughtful valuation process before determining your asking price. Take the time and get the help you need to do this, so you’re in touch with marketplace prices and better able to defend the price you set.

Not Securing Expert Advice

Expertise at running a business doesn’t translate into expertise at selling it. While you may resist paying the brokerage fee (roughly 10 percent), a good broker typically adds at least 10-12 percent to the sales price while saving you from lots of headaches. Their services includes helping prepare the company for sale, attracting and identifying qualified buyers, showing the business, marketing and negotiation. Similarly, securing the advice of other qualified professionals such as lawyers, accountants, and financial consultants is a good and necessary investment.

Being Too Hands-Off

Hiring a broker doesn’t mean your work is done. Because you’ve got the inside knowledge of the business, long-term experience in the industry, and serious motivation to sell, you need to view the relationship as a partnership. Disengaging from the selling process will jeopardize it. Communicate with your broker that you’re willing and able to support their efforts, and find out how you can do so. Your interactions with potential buyers also plays a key role. They’ll rely on their impressions of you to inform them about whether the business has the potential they seek, and whether they can expect to manage it successfully.

The Bottom Line

Without a crystal ball, you’ll never know beyond a doubt that you’re selling at the right time and at the right price. Run your business the best way you can; keep salability in mind; stay on top of the big picture in your industry; and recognize the value of outside expertise. Ideally, your decision to sell won’t be forced by outside circumstances, but it’s smart to be prepared for anything.

Visit our website to learn more about how we can help you sell your business!

Selling a Business: The Transition Period

If you’re not considering selling a business now, we predict that you will in the future.

Ideally, selling a business is the culmination of years of planning and intention, but sometimes it’s a frantic, last-minute activity brought about by an unexpected change in circumstances. If you’re planning or hoping to sell a business in the next three to five years, you’d be smart to start thinking about the transition process. And even if selling your business is not in your immediate plans, it can’t hurt to give the process a little thought, because we never know what the future will bring.

At first glance, it may seem there are just two stakeholders in the transaction: seller and buyer. However, there are other parties to add to that list: your employees, your clients and customers, your vendors and suppliers, and possibly your family and your community. All parties will benefit from a smooth, well-planned transition.

Transparent Planning Is Crucial

If you’ve bought or sold businesses before, you’ve encountered some of the complex issues that may accompany the process. You may even recall thinking, “who knew it was so complicated?” A good starting point for your planning might be to reflect on what went right and wrong in previous transactions, and what issues took you by surprise or proved to be trickier than you anticipated.

While different businesses will have different details to work out, here some elements to consider common to nearly all transactions.

Define the Outcome

While the obvious, basic outcome is “sell the business,” it’s valuable to get more specific. The smoothest, least disruptive sale is always a goal, so anticipate potential disrupters and how to mitigate them. A clearly defined end point makes communication easier, and the establishment of a timeline and guideposts easier. Other outcomes to shoot for include minimizing anxiety for both seller and buyer.

Build a Transition Team

Team size and composition will depend on the size and nature of your business, but you generally want to include both in-house personnel and outside advisors. An ideal team might include a couple of top managers, some outside advisors such as your outside counsel and accountant, and a professional business broker/advisor.

Clarify Decision-Making Strategy

At some point decision-making authority will transfer from the old to the new. During the transition period, make sure all parties have clarity about where the buck stops and when decision-making authority is formally transferred. Your business broker will have valuable input on this question.

Financial Changeover

This one’s big: it’s complex, and the stakes are high. Your business broker, accountant, and legal counsel and business insurance Miami company will help make sure all elements are planned and executed responsibly. Accounts, loans, credit lines,  payables and receivables, leases, insurance, taxes, retirement plans: there are myriad financial aspects of the business operation which must be transitioned to new owners.

Establish Accountability

Decide who will be responsible for executing each responsibility, and establish a timeline. Detail the phases, the actions, and the steps to bring about a successful transition, and assign responsibilities with deadlines. Use this to inform communications with other stakeholders: keep them in the loop so they remain confident in a good outcome.

Near Term Developments

Communicate any upcoming issues the new owners need understand and be aware of, such as regulatory changes, ongoing projects, etc.

Training the New Owners

Communicate openly with the new owners about their involvement plans and establish a training plan. Whether they’ll be hands-on or hands-off, they need to know how your business operates.

Staffing Considerations

This is a stressful time for the employees you’re leaving behind, so demonstrate your support for them. The new owners may rely on the existing team or they may be motivated to make changes. While your greatest interest may be the success of the new buyer, you’ll support the new buyer best by keeping your existing employees enthused and positive about the transition.

Planning Pays Off

Working on your transition plan is essential If you plan to sell in the next few years, and it’s a great general “covering the bases” move under any circumstances. If you’ve just bought a business, take some notes now about the pain points and the successes: they’ll be sure to come in handy when the nearly inevitable day comes that you wish to sell your business.