Welcome back to my weekly articles on business building. In order to extract value from a business it needs to be sellable. For many business owners, the value of their business will dictate how successful (or not) their retirement will be. In my last article I discussed how understanding the value of your business will be critical to understanding whether it will support your retirement needs. In this article I introduce three key Gaps - the Profit Gap, the Value Gap, and the Wealth Gap. Understanding what these Gaps are, analyzing how they affect you and your business, will provide you with guidance on what must be done to create a maximum value, highly sellable business that will meet your retirement lifestyle income needs.
Most owners get one chance to get it right when they decide to sell, yet most owners cannot sell the business they built (only 1 in 10 are successful) because they did not build a sellable asset. If selling your business to fund your future lifestyle is a must, ask yourself whether you are prepared or not, and then identify what you need to do to get to where you need to be.
With up to 76% of Canadian businesses reporting that they hope to exit in the next 10 years, being unprepared might cost you both your legacy and your retirement.