The pandemic has changed many business owner’s thoughts and plans for transitioning or exiting their business. The emotional and financial stresses created over the past year have many people wondering, “Is it really worth it?” Unfortunately, there’s still no “easy button” to push that provides you with millions of dollars in compensation for your business without putting in the work.
Here’s the issue, most people still don’t know where or how to begin the process of valuing and preparing their business for an eventual exit. What are the options? Who is interested? How much is it worth? How do I protect my current employees? What am I going to do once I’m gone? These are all really valid questions and concerns. In fact, the one that is usually the least contemplated, but ultimately the one that causes the most anxiety is “What’s next for me?”
One of the things we generally do at Contractor Succession, following an in-depth assessment of you business, is working to create a corporate vision statement as well as a personal one for the owner. Hopefully, they have some relationship to each other. It helps when the corporate vision can move the owner towards their personal vision and visa versa. In general, most smaller, family-owned businesses do not have either of these and, are therefore floating around like a ship without a rudder. Not all business owners are created equal, however. I’ve seen some individuals sell their business and walk away without a care in the world, hightailing it to the golf course, the Caribbean and the Denny’s breakfast buffet.
Why are some able to disassociate with the business and others feel the need to go down with the ship? In most cases, it has to do with their self-worth outside of the business life. Creating something of meaning that will fill the void of being the “head honcho” is one way to ease that separation anxiety that exists at exit time.
Bottom line: Start getting your house in order, post-pandemic. Opportunities will abound as contracting businesses, especially HVAC, become a hot commodity for buyers and private equity firms.