Everybody wants to go out a winner. That certainly applies to a business owner who is approaching retirement. But what will it take to make sure you can walk away from the daily grind and into the next phase of your life with confidence?
Money. Whatever the reason you started your business, as you prepare to wrap things up your focus should be on how much money you’ll be able to take away, and how long that money will last.
After putting a lifetime of effort and energy into your business, it is your most valuable asset. Whether your plans include passing the business on to your children, selling it to your employees, or selling to a competitor, it is essential that you grow the value of your company throughout its life so that it will be able to provide you with a comfortable retirement.
There are important steps you can take to help ensure that the business grows in value. The time to take these steps is not a year before retirement, but right now while your business is vibrant and vigorous.
There are several factors that make up the “value” of a business.
I will show how to accomplish the following:
- Establish a starting point by determining the current value of your business
- What are the elements that make up the value of a business?
- Key areas for improving business value:
- Keeping a “clean” customer list
- Boosting margins
- Collections
- Equipment upgrades
- Keeping your company competitive
- Tax elections to improve cash retention
- Selling your business at maximum profit
John H. Nardozzi, CPA, CVA, MST is the owner of Nardozzi, LLC (www.nardozzillc.com) which provides consulting and valuation services for oilheat and propane dealers.