If you’re a business owner looking ahead to retirement, you may see the light at the end of the tunnel. Yet troubling headlines — tariffs, immigration policies, inflation, and Wall Street volatility — create uncertainty.
Similar headlines also appeared in 1980-81, 2007-08, and 2014-15, meaning business is cyclical. It’s easy to get caught up in immediate challenges and postpone your succession and exit planning. However, smart business owners know that preparing for a transition is not just about the future — it’s a strategic move that strengthens the company today. Whether your exit is five months or five years away, taking proactive steps now is critical.
The best transitions happen when time and strategy are on your side. Whether you plan to sell or pass your business to the next generation, a solid plan can make a difference regardless of external factors beyond your control. As Benjamin Franklin said, “By failing to prepare, you are preparing to fail.”
Focus on Now
While we can always count on change, the pace of change is accelerating. For business owners, waiting until the last minute to prepare for a sale can lead to a rushed process, lower valuations, and missed opportunities. Here are several trends underscoring the urgency:
- Increased Competition in and for Acquisitions: The pool of buyers (including private equity, holding companies, and strategic buyers) has grown significantly, yet only 80% of businesses sell. Standing out requires a well-prepared, transparent, best-in-class business with little to no dependency on the owner.
- Economic Volatility: While inflation, interest rates, and global instability may impact the buying landscape, businesses that are prepared to sell can seize opportunities quickly.
- Generational Shifts: Every day, 11,400 Baby Boomers retire, flooding the market with businesses for sale. Preparation ensures your business stands out as the most desirable.
Preparation is Power
Preparation is a mindset, not a checklist. By focusing on key areas of your business, you can attract the right buyers and command the best price.
1. Clean Up Your Financials
Buyers want clarity. Ensure that your financial records are organized, transparent, and accurate.
- Hire a CPA to audit your books.
- Separate personal and business expenses.
- Show consistent growth and profitability over several years.
- Focus on EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) — it can be your best friend or worst enemy.
- Determine the best corporate structure (i.e., LLC, S-Corp, C-Corp) and explore opportunities to create LLCs that are separate revenue-generating entities. (e.g., the company rents the land from an LLC in your name).
2. Streamline Operations
A well-oiled, owner-independent business is far more attractive to buyers. Ensure:
- Standard Operating Procedures (SOPs) for critical functions are documented.
- Workflows are efficient and transferrable.
- Your business can operate without your daily involvement.
3. Focus on Customer Retention
While customer acquisition is essential, recurring revenue and loyal customers are gold for potential buyers.
- Track customer lifetime value (LTV) and churn rate.
- Create predictable revenue streams like subscriptions.
- Take care of your best customers — it’s cheaper than acquiring new ones.
4. Build a Strong Team
The strength of your management team is a key selling point, ensuring continuity and reducing buyer concerns. You need:
- A clear organizational structure.
- To implement employee training and development programs.
- Well-documented roles and responsibilities.
- A company that can run without you.
5. Intellectual Property & Branding
A recognizable, protected brand and unique intellectual property are valuable assets that offer buyers a competitive edge. Take steps to:
- Register trademarks and patents.
- Build a robust online and social media presence.
- Ensure consistent branding across all customer touchpoints.
When done properly, these steps will help you bridge the gap between your business’s current value and the amount you need for your future lifestyle or your Freedom Point.
6. Valuation Positioning
Get a business valuation to understand your business’s worth and identify areas for improvement:
- Market Position: Show how your business stands out.
- Scalability: Highlight growth potential and how a buyer might expand the business.
- Risk Mitigation: Address potential risks (e.g., reliance on one customer or supplier) and present solutions before buyers raise concerns.
7. Finding the Right Buyer
Not all buyers are created equal. Seek a buyer who shares your vision and understands your priorities — price, legacy, employee welfare. An experienced advisor can streamline the process and ensure a higher return.
The Final Word
Even if you’re not planning succession or sale soon, preparing your company for the strengthens your business today. Preparation is a testament to your forward-thinking leadership and serves as a hedge against uncertainty.
In any economy, businesses are bought and sold, but only the best ones sell. Acting now ensures you’re ready for the transition when the dust settles and the opportunity arises.
Make Your Voice Heard
Those participating in the 2025 State of Succession and Exit Planning in the Horticulture Industry Survey can contribute to a stronger, more resilient industry while gaining a clearer understanding of where your business stands.
Click here to take the survey.