Starting a business is no small feat – it takes courage and determination. But to truly succeed, you also need a solid strategy. 

Business owners are well acquainted with taking risks and dealing with uncertainty. However, the recent economic climate has raised the stakes. Many are now in the uncomfortable position of having to rethink their carefully laid-out succession plans and exit strategies. Some may even be considering selling their business sooner than planned, potentially for less than it’s worth.

Is transitioning a better option?

Rob Young, Managing Director of Platform 1, specialises in helping business owners get the best return when it’s time to sell. His advice? Start by exploring all your options.

There are five main ways to sell a business:

• Close it down and sell off the assets
• Sell to a family member
• Sell to an employee
• A straightforward sale to an external buyer
• A gradual buy-out – this is the Platform 1 model

The Platform 1 model offers a more gradual approach. It involves bringing a manager on board early, so they can take over smoothly when the time is right. Here’s how it works:

1. Identify the right person to lead the business.
2. Develop and train them.
3. Create a plan where they buy into the business gradually, over 3 to 6 years.

The goal is to transition the owner out of the day-to-day as quickly as possible, passing on key relationships and processes to the new leader. This way, the owner moves from managing the business to more of an investor role.

Getting ready for a sale: What matters most

• Get organised: Make sure your systems and processes are robust, so the business can run smoothly without you.
  
  
• Maximise profit: Focus on building profitability, rather than minimising taxes. A profitable business is far more attractive to potential buyers.

Don’t delay planning, even if you're not ready to sell yet

It’s smart to start thinking about succession well in advance, so you can maximise the value of your business and secure a better outcome. And remember, retiring doesn’t have to mean stepping away entirely. If your business can operate without your direct involvement, you might not need to sell 100% of it. Retaining some ownership can be a viable option.

Need help with your succession plan?

If you don’t have a plan in place yet, we’re here to help. Get in touch today, and we’ll make sure you’ve got the options you need when the time comes. Give us a call on 01904 787 973 or book a discovery call with Donald Inglis.