The average age of small business owners in the UK is 49 and 43% of all new businesses are currently started by over 50’s. Many are looking at the exit of their business to fund their eventual retirement, that is to sell the business or pass it on to the next generation.
Over 50%, unfortunately, will exit due to death, illness, divorce, dispute, financial distress, bankruptcy or other unforeseen events.
A significant number of business owners expect the sale of their business to fund their retirement, with over 35% of all Brits having no pension provision at all, relying on their assets to fund post-work life. We know that since 2008, when the global financial crisis (GFC) occurred, many business owners actively delayed their retirement or exit plans. 22% of all over 55’s have extended their expected retirement date and more than 40% were unhappy with their current financial position.
Of all family owned businesses in the UK, more than half the business owners intended for the next generation to take over yet nearly 70% indicated that they were not ready to do so even though retirement age was looming or, indeed, passed.
80% of all businesses that are put up for sale never get sold and there are 4 main reasons commonly attributed to this:
Lack of preparation
Poor financial reports
Unrealistic price expectations
With so many business owners in weak financial positions looking to sell, and a lack of cashed-up buyers in the market, it’s more important than ever to plan your business exit to extract the highest possible value. You can’t just start to think about it when you turn 64 — if you don’t plan, you get a poor price. But a good succession plan is a win-win for everyone — you get the best price; the buyer gets a good business and your customers and staff are looked after.
At Succession Plus we take a holistic view to succession planning, looking at your business and personal goals and putting processes and systems in place to help you reach the best outcome, offering expert advice in management, taxation, employee incentives and accounting issues.
If you have been working hard in your business for many years to create wealth for you and your family, this book will help you to realise the full potential of all your efforts and investment. These are the rewards you set out to achieve.