Exiting Your Business
In Canada, only 10 per cent of small business owners have a formal plan to sell, transfer or wind down their business in the future, according to the Canadian Federation of Independent Businesses (CFIB). More than half have no plan at all. The same is likely in many other jurisdictions around the world. Just like any other part of business development and growth, having an exit strategy is essential for the success of the final stage of your business.
Exiting your business may involve a management buy-out, family succession or the sale of the business. Regardless, financing of the change of ownership correctly is crucial. In Canada, according to the CFIB, having an adequate financial plan is the main obstacle to succession planning, for both the existing and new owner.
Seek help from your Financial Planner, who can make sure you have a sufficient and recurring stream of income or assets to fund your retirement, and see that any plan you have in place continues to reflect your changing needs. Learn more at RBC Financial Planning.
Your lawyer or professional associations are also important resources who can offer guidance about any regulatory requirements you must adhere to. And be sure to contact your accountant for direction on how to reduce your tax exposure.
This is intended as general information only and is not to be relied upon as constituting legal or other professional advice.