Len Hornung is a financial planner, wealth manager and business exit strategist for contractors. We wanted to interview him to find out how to build a contracting business that was capable of being sold.
So how do you look to the future and think about selling your business or exiting your business and what type of options do you have? Len says that it’s all about initiating a process.
Len is a big proponent of starting with the end in mind. So when should you start? How about now!
Len describes the different ways on how to transition inside of your action planning strategy:
- to sell out right
- sell to employees or
- lastly to sell or leave to your family which is a completely different animal altogether
On average 70% of businesses that are sold first to families then to employees. The balance are sold outright or just shut down. It’s kind of interesting on how you might think about setting up your business to and your exit strategy for the future.
Always be thinking with the end in mind.
Two key factors in your strategic exit planning for the future are, number one to have a qualified motivated management team in place that’s going to be around for the long haul.
The second is to create off balance sheet of non-business wealth so that when you do go to retire, your retirement income isn’t solely from the sale of your business but by the wealth you’ve created from your business.
Len mentions for the smaller contractor who does 1 million or a little more, one key element to get to your successful exit planning started is by creating a great incentive plan. A reward plan for your employee so they will think about staying because there an incentive and because they are rewarded by performance and how well the company does. By doing this you have created a long term employee. Len says this is a must to get and keep employees in an industry that is competing on good labor.
You can get a hold of Len Hornung and his team at http://successfulexit.biz also check out his resources pages
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