Sick of fighting for business in the down economy? For some business owners, hard times may force you to wonder whether it's time to cash in and move on -- or at least, sell a stake to someone who might eventually buy you out.
If you're thinking about leaving your business behind, some careful planning up front can make it a smooth transition that ensures your company thrives after you're gone. Here are five tips on how to make a graceful exit from Suzanne Bates, executive coach and author of the upcoming book Discover Your CEO Brand: Secrets to Embracing and Maximizing Your Unique Value as a Leader:
- Work on a succession plan. What do you want to happen after you leave? Write up a plan that spells out your wishes. If you're considering passing on or selling the business to a family member or employee, notify them of your intentions. Ensure that your plan answers questions about who will be in charge, how much of a stake they will acquire and at what cost. It should also offer a timeline for the transfer of power.
- Groom a successor. The world of family business is full of sad stories about owners who suddenly decide to retire and drop the business into the lap of a brother or daughter with little training or notice. Start teaching your heir apparent about the business's operations and finances now, and assume it may take many months or even a year or two to pass on all the knowledge. Notice their weak points and either train or hire professionals to help. If they have poor customer-service skills, for instance, you want to fix that before you hand off the baton.
- Create a great communicator. Your successor needs top-of-the-line communication skills to influence clients, vendors, employees and others. If you don't build this skill, Bates says, it's like the "substitute-teacher" phenomenon: the kids will act up, not listen and accomplish little until either the sub builds confidence, or the "permanent teacher" -- you -- return to clean up the mess.
- Show your faith. If you don't instill confidence in the proposed successor and demonstrate to workers that you trust this person to take over and keep the business growing, you're sowing the seeds of future problems. Make sure everyone knows who your choice is and that you're excited about how this new leader will approach the business.
- Let them be who they are. Your leader should not try to mimic your personal style or your management style. The new leader needs his or her own vision and approach. Leaders with their own strong brand will be better able to succeed as they take over the top role.
My tip: Think of letting go in stages, if possible. Even if you're selling to an outsider, you may want to negotiate for a transitional consulting/training period where you're still on board.
Are you thinking of selling your business? Leave a comment let us know why.