Who really needs a succession plan?
“I don’t need to plan. When I am ready, a buyer will find me.”
One of the hard lessons of the Recession of 2008–2011 and in 2020 is that the timing of an exit depends on a vibrant economy with active buyers, a company with strong cash flow, and an owner ready to sell. These factors seldom exist in equal measure at the same time.
We suspect that some owners believe that waiting for a future economic tide to bring back well-financed buyers involves little to no risk. However, this type of passivity is fraught with danger:
- What if a qualified buyer doesn’t show up?
- What happens if the acquisition market is dormant?
- What if the owner’s industry niche has fallen out of favor?
- Does a national competitor want to move into the owner’s territory?
- Is the business and/or the economy in decline or worse?
- What if the owner’s health and/or personal circumstances unexpectedly deteriorate?
- What happens if the economic tide does not return at all or at least not for many years?
Get in touch and let’s make a plan.