Steven J. Dundas
Making your exit a profitable one
Small-business owners looking to sell should finalize plans early
BY BETH FITZGERALD ciation of Certified Valuation Analysts.
BEFORE SELLING the company, small-busi- The process will take a year, two years or
ness owners should count on spending a year or even longer, and the business owner will
more preparing it for sale to improve their spend much of that time benchmarking: figur-
chances of a lucrative payday for an enterprise ing out where the company’s performance lies
that may represent the labor of a lifetime. relative to its industry.
The stock market’s dive and the home- “The business has to do a reality check,
price slump are dramatic evidence of the fall-off and find out if they’re an average performer, a
in U.S. asset values, and high performer or a low performer in their
small, privately held com- industry,” Allsopp said. Robert W. Waring, a partner of Strategic Exit Advisors, says it is impossible for a business owner to make
panies are not immune, His partner, Robert W. Waring, said, a smooth exit if the employees cannot carry the company and are reliant on the owner’s presence.
experts say. But a company “One of the biggest areas where the smaller
that makes money and businesses tend to lack sophistication is tomers, which makes the business very risky?” the number of middle-market business sales
outperforms its industry making sure they have an employee group in A business owner may devote consider- to about 2,000 in the final quarter of 2008, from
can still fetch a decent place that can carry the company. Whoever able time and effort to fixing up the company more than 3,000 in the second quarter of 2007,
price — even if that price is buys the company needs to make sure for a sale, and then decide not to sell — or according to the Capital IQ division of Stan-
less than it might have Craig O. Allsopp there’s a team in place that can run this switch sides and become a buyer. dard & Poor’s.
been a few months ago. thing. If the business owner is 100 percent “Instead of being a seller, this might be the But once the economy picks up, “there’s
“We really stress the idea that business required for the business to succeed, then time to acquire your competition, and get posi- going to be a lot of people who’ve been sitting
owners have to get prepared to take their busi- they are never going to get out.” tioned for a turnaround in the market,” said on the sidelines and are going to want to go
ness to market,” said Craig O.Allsopp, managing Another dimension of a smooth exit is a Alan Wink director of the management con- out in the marketplace, and the best perform-
partner of Strategic Exit Advisors in Hopewell. business model analysis, Allsopp said. “Who are sulting group at Amper, Politziner & Mattia in ers will get the best prices and the best terms,”
Retiring baby-boomer entrepr