<p><strong>Picture this - you’ve worked for years to build your business. &nbsp;You hope to retire in the next five or six years. &nbsp;You will use the money from that sale to buy the family a relaxing cruise, invest some for retirement and finally, do what you want to do with your time.</strong></p> <p><strong>Sounds lovely, doesn’t it? &nbsp;Unfortunately, for many who hold that dream dear, it doesn’t work out that way. &nbsp;It happens for a lot of reasons. &nbsp;Sometimes, the market conditions aren’t right. &nbsp;At other times, owners get in their own way.</strong></p> <p><strong>Today you have the chance to get the insider view of the transaction at the point of choosing the best fit buyer. &nbsp;Dan Scherotter, a broker and strategy consultant with Filament Business Advisors, has a background in the restaurant industry.</strong></p> <p><strong>Dan is a former chef and restaurant owner. &nbsp;Dan has a finger on the pulse of the restaurant industry. &nbsp;As a consultant and broker for Filament, Dan is going to discuss with me the unique aspects of selling a restaurant, asymmetrical buyers and how the past year has “laid the industry bare” structurally.</strong></p> <p><strong>First, you need to sit down and define your priorities. &nbsp;What do I mean?</strong></p> <ol> <li><strong>Do you know what your financial outlook is?<br> </strong></li> <li><strong>Can you afford to take an earn out or reinvest part of the proceeds of a sale?<br> </strong></li> <li><strong>What are the tax implications of the sale for you personally?<br> </strong></li> </ol> <p><strong>Many owners don’t know what they actually need to realize from the sale of their business. &nbsp;Sounds crazy, doesn’t it? &nbsp;But, it’s true. &nbsp;I recently heard of an owner who thought (no data, just thought it) that he/she needed to walk away with $3M to be comfortable in retirement. &nbsp;As it turns out, $2M was the magic number and that business sold and the owner was able to take an earn out for a larger purchase price based on forecasted earnings.</strong></p> <p><strong>Think about your other priorities:</strong></p> <ul> <li><strong>You want the company to stay in your town.<br> </strong></li> <li><strong>You want the new owner to keep all of the employees for at least a year.<br> </strong></li> <li><strong>You want to continue acting as part of the business development team.<br> </strong></li> <li><strong>You want a seat on the Board.<br> </strong></li> </ul> <p><strong>These requests are reasonable if they are presented in a professional manner and the owner has created a strong position as a valuable company. &nbsp;The likelihood of those priorities being accepted depend on the value of the company, and the timing of the ask. &nbsp;This is another incident where the right advisor is critical.</strong></p> <p><strong>Let us know what you think: Wendy Dickinson, </strong><a href="https://ascendcoachingsolutions.com/"><strong>Ascend Coaching Solutions</strong></a><strong>, 804-372-7575, [email protected]; Dan Scherotter, Filament Business Advisors, 804-728-1553 </strong><a href="mailto:[email protected]"><u><strong>[email protected]<br> </strong></u></a></p>