How to overcome consequences if you don't have business transition plan

 

You have built a company and now you are about to leave it, sell it to someone else or start a life in retirement. The day after your retirement, you have a strange feeling and you don't know what to do with the good money you have saved. To prevent this from happening, preparing for the business transition phase is essential. Here are some tips.

       Set goals: As the transition phase of your business approaches, you should make financial planning for the future. Establish what lifestyle you want to have and how much money you will withdraw from the business to achieve this goal. Are you looking for a definitive withdrawal (in case of sale, mainly) or will you continue to receive dividends?

 

       It is important to plan how you will spend your days after leaving the company. Will you channel your energy into any activity? Do you have hobbies and chores to keep you busy? Start planning this at least three years in advance.

 

       Have a succession plan: The best way to handle the transition phase is to put a strategic plan into action. From training your successor to diversifying your company's operations and processes so that everything goes according to plan, even when you're gone.

       In the case of sale to an external buyer: Present it to your employees, managers and clients. Explain what your business values are and create an environment that facilitates long-term opportunities for success. With the same anticipation that you plan the personal transition, you must also steer the company towards the later phase.

       Prepare yourself emotionally: Kenyan David Karangu came to the United States at the age of 17. At 40, he sold his two car dealerships. Despite getting the money he wanted, the following Monday after the business was done, he got out of bed, put on a suit, and only then did he realize he had nowhere to go. After a week, he realized that all his friends and people with whom he related were connected in some way to his businesses. Despite having won a lot, he was unhappy. And, worst of all, he didn't get the sympathy of the people, who only saw the good part of the transaction: the money. Losing orientation is normal. The important thing is to have a goal to guide you after the transition phase.

       What to do next? : You completed the transition successfully, and now? After selling to Concord Holding Corp. in 1996, 40-year-old American entrepreneur Rick Stierwalt began training to be a racing driver. To realize this dream as a child, he travelled weekly to Indianapolis, a motorsports centre.

“It was a job as tough as working. Training on Thursdays, qualifying on Friday and races on Saturdays and Sundays. And still, he had to be in good physical shape, "Stierwalt told the business website Inc.

Instead of staying home or opening another business, leaving the company may be what you need to realize an old dream. Enjoy!

 

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