This article is not about 20/20 vision. The focus is on the year 2020 and how to take a few steps to refine your business life. Most owners want more out of their business, and that “more” is not always money. Some want more time to enjoy their life, others are making good money, but they are concerned about risk or some other element in their business. Many owners are questioning when they should retire and how to begin the process of getting there.
What choice best describes you? Before you answer, think about your pain points. What bothers you day to day? Is it a drive to do more? There are a lot of serial entrepreneurs that will never stop innovating at any age. Many owners have all the money they need, but enjoy working or don’t know what they would do if they no longer went to work. Some owners need to continue to work or exit at a good price because their personal financial needs are not quite at the level that makes them comfortable.
Here are a few fun facts:
- The average Baby Boomer is 65 years old.
- Those Baby Boomers own about 60-70% of all businesses in the U.S.
- 30% of businesses try a family succession.
- 70% of businesses try to sell.
- Not all businesses sell.
- To some owners, 80% of their total worth is tied up in the business.
Now, back to your choice. What do you want to do? Are you a Baby Boomer thinking about retirement and an exit strategy or a family succession? Is it too soon to think about exiting, but you feel the business could be performing at a higher level? Do you have other plans to expand or make material changes, but lack of time keeps getting in your way and pushing your plans out further? Do you just want to think about taking more time off?
Some decisions require investments. As an example, if you want to be producing more profits you might need to look at investing in new accounting or specialty software, reassessing your costing process or pricing strategy, training staff, expanding service or product lines, etc. You may need to consider a new location or acquiring another business. Other decisions may require a leap of faith. You have family in the business or employees that could take over, but when you do you step aside and guide them into leadership? That is a tough call for any owner because it requires a self-evaluation that it is the right thing to do for the business and for your family.
This time of the year is the window to begin laying out your options. Most efforts to implement major changes seem overwhelming because some can be. The hardest part of any change is starting the process. Once you start, sometimes the effort is not as difficult as you thought and then you wonder why you did not do this years ago. Other efforts are difficult and will take time to execute. We are here to help if you need us. Our firm has had the benefit of dealing with owners of varying size who have had to make these kinds of decisions already. We may be able to help you get some changes started.