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Exit Planning
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A recent
survey by a public accounting firm of medium sized companies
indicated that two-thirds of the business owners plan
to leave their company within the next 10 years. Yet, only 22% of them report having done
any material exit planning. In fact, business owners
are more likely to have plans in place should they become
disabled than they are to have plans for their own voluntary
and inevitable exit! This is a surprising statistic,
given that the owner’s exit from the company is
likely to be the most significant financial event of
his or her life.
An effective exit plan enables the business owner to
leave the business: (1) according to their timetable,
(2) on terms that provide financial security to the
owner, and (3) transfer the business to their desired
successor
The exit planning process begins by establishing the
business owner’s objectives and the current value
of the business. A plan is then designed to take
the business from its current state to where it needs
to be in order to allow the owner to achieve his or
her objectives upon exiting the business. This plan
covers everything from:
- Growing the value of the business;
- Identifying, motivating, and retaining key employees;
- Designing the most efficient operating structure
for the business;
- Identifying and positioning likely successors/purchasers
of the business;
- Creating a plan to address current and future shareholder
issues;
- Developing a contingency plan in the event of the
business owner’s death or disability;
- Structuring the transfer/sale of the business in
the most tax-efficient manner; and
- Addressing the owner’s family wealth preservation
needs.
At Krass Monroe, we have identified an Exit Planning
team that includes the unique tax, business, wealth
preservation, and financial expertise and experience
necessary to help you develop an effective exit plan.
Our multidisciplinary approach helps our clients achieve
the optimum Exit Plan.
For
additional information, please call Scott Husaby or
Mark Moxness at (952) 885-5999. |
