Turkey day is almost upon us. As we think ahead to the big day, we’re reminded how hosting Thanksgiving is a lot like selling a business. They both involve a great deal of planning, proper timing, recipes for success, and the perfect guest list.
Let’s carve into this analogy in stages, just as you’d carve the Thanksgiving turkey:
Stage 1: Planning
Just as you need to start planning your Thanksgiving gathering well in advance, you also need too start planning for the sale of your business well before you’re ready to put it on the market.
Regular valuations, typically done every two to three years, provide invaluable insight into your company’s market value and help you determine the right time to put it on the market. Early planning can also help you add value to your business. Familiarize yourself with what potential buyers find valuable and explore tax and working capital strategies to optimize your net proceeds.
Just as a Thanksgiving feast requires a skilled team in the kitchen, assembling the right advisors is essential for a successful business sale. A comprehensive deal team should consist of an M&A advisor, a specialized M&A attorney, and an M&A tax specialist. Your trusted CPA and your financial advisor will also play a pivotal role in ensuring a smooth transaction.
Stage 2: Getting ready
After extensive planning, it’s time to roll up your sleeves and start preparing for the grand feast, which, in this context, means cleaning, grocery shopping, cooking, and setting the table. Similarly, in the business world, it’s time to prepare your company for sale.
Think of your business as a savory turkey. Follow the recipe meticulously, and potential buyers will eagerly line up. Start with a 20-pound management team, well-seasoned with autonomy and experience. Serve it with sides of customer diversification, clean financial records, standard operating procedures, and recurring contracts. For dessert, present a clear strategic vision for future growth.
Stage 3: The big day
It’s feast day. This is when all the hard work you’ve put in comes together. Just as Thanksgiving brings families together, a well-executed sale can unite two companies, creating a stronger whole. This is where the magic happens.
Stage 4: Final clean up
After the Thanksgiving feast, there’s still some work to be done—cleaning up the kitchen, putting away leftovers, and storing that turkey fryer for another year.
Similarly, after you sell your business, there will still be some post-sale activities to complete. This may include assisting with the transition process, helping to ensure both the employees and the customers remain with the new company.
Stage 5: Benefits and gratitude
After the big Thanksgiving feast, we savor the leftovers and take a moment to relax, unwind, and reflect on a job well done. Similarly, if you’ve planned your business sale well, you can enjoy the rewards of both time and money.
Plus, it’s a satisfying feeling knowing that your business is in capable hands, with a buyer poised to increase market share, expand product lines, or enhance efficiency. Your business legacy continues, and your employees have the continued opportunity to contribute and thrive.
In the spirit of Thanksgiving, let us remember that a successful business sale is worth celebrating. Just as a Thanksgiving feast brings joy and togetherness, a well-executed business transition can bring growth and prosperity for everyone around the table.
