7 statistics from a recent survey in the US that point to some of the challenges:
- Minimal mindshare
53% said they had given little attention to an exit transition plan. Yet 75% of respondents were aged 51 or older
- No transition plan
88% have no written plan exit transition plan and 66% had no plan at all
- Going it alone
80% had never sought advice about a transition
- Lackadaisical about future financial needs
70% don’t know what after tax income they need to support their lifestyle after their exit
- Unknown value
67% agreed that getting full value for their business to fund retirement or other business interests was their top goal on an exit. Yet less than 40% had had a formal valuation conducted in the last 3 years.
- Partnership planning
Less than 48% of businesses with multiple partners have a buy-sell agreement in place
- Management questions
33% of surveyed owners had not even thought about management succession and only 25% were comfortable that their management team would be successful if the owner was not involved after the transition.
If you have 70% plus of your wealth in the business, how can your exit be successful if you don’t have a plan or an external view on the value of your business?