Those who advise others on a variety of issues have a challenge when it comes to exit planning from their business. I find that as I talk with advisors around the country they are great at providing advice for others but often don’t think about how they want to leave their own business.
In fact many of them never think of themselves as business owners and as a result don’t do the things that are necessary for them to leave their business. We all leave our business at some point, but many of those in the advisory business never give any real thought to how an exit might happen for them.
Even those who specialize in helping operating businesses plan their exit don’t think about their own exit. The following are things I suggest you think about as you plan or think about planning the exit from your business or practice.
- Professional advisors think about their business as practices and not businesses. The same rules apply to these professional practices as any business owner who wants to exit and move on to something else.
- Professional advisors usually don’t make themselves irrelevant in their business. If you don’t do this you don’t have anything to sell to others. A Customer list that is dependent on your work has no value to a successor owner.
- Professional advisors don’t understand the metrics and drivers of their own business. Most of the time professional advisors will take any business that walks in their door. Having a definable niche is crucial in increasing business value for advisors.
- Professional advisors don’t have budgets or business plans. If you want to transfer your business to others you need to be able to demonstrate the value of your business to them. Without plans transfer becomes much more difficult.
- Professional advisors haven’t thought about what’s next and how they want to leave their business. There is no rule that you have to sell your business. With proper planning you can just close up shop when the time comes.
Deciding whether you want to sell your business, closes up shop, or just transfer to someone else in your firm is your choice. Exit planning for advisors is an activity that all who give advice should do. What do you think?