Ultimately, your ability to get top dollar for your company may depend on your ability to create an employee incentive plan that will motivate and keep good management. An important characteristic of any successful incentive plan is that key employees earn the incentive bonus based on a performance standard that, when attained, increases the value [...]

One constant of successful companies is a stable, motivated management team. This quality not only contributes to corporate success, it is also key to increasing the value of your business and your successful business exit.
Should you decide to sell your business to a third party, you’ll discover that potential buyers place significant value on the [...]

In today’s Merger and Acquisition marketplace, an all-cash buyer is as rare as a balanced federal budget. Those buyers who do arrive at the closing table with cash in hand may not be over-burdened with huge bagfuls.
Almost as uncommon as the all-cash buyer is the offer of a valuation multiple that approaches (much less matches) [...]

Fictional owner, Peter Miller, had called his accountant to ask her to help him value his business with the idea of retiring in a few years. No stranger to Exit Planning, his accountant assembled all of Peter’s advisors and launched a complete Exit Planning process. She began, not with an examination of how a transfer [...]

If you contemplate transferring your business to an insider (employees, children or co-owner) and you want to get paid the value of your business, then, generally speaking, the value of your business cannot exceed four times the true cash flow of the business. We have defined true cash flow as the amount of pre-tax money [...]

It may not be uncommon for a business owner to hear that one of his friends sold her business for a “six times multiple.” That owner’s first question to his own advisors typically is, “Can I get the same type of multiple if I sell my business?” The answer is “Yes and No.” To understand [...]

Business owners must meet the challenges presented by recent changes in the economy. What can we learn from owners and their advisors across the U.S. about which strategies are most effective? We invite you to share stories about how your company has been affected and how you are responding.
General Observations
Owners, who ran tight ships when [...]

In previous posts, we have discussed importance of value drivers: the intrinsic characteristics of a company that buyers look for when deciding what company to buy and how much to pay. We’ve talked about how important value drivers are in a successful sale and consequently how it is the work of the owner (not employees) [...]

The recession has brought a lot of challenges, but it has also brought the luxury of time: time to figure out exactly what you need from the sale or transfer of your company to support a comfortable post-sale lifetime and time to create enough value in your company to achieve your desired sale price.
Most owners [...]

Near the end of 2008, we noted that the economic downturn had forced many owners to postpone their plans to exit their companies. We then looked at the several actions owners could take to respond to that delay:

Ride out the storm doing one’s best to protect value.
Use the time to build business value.
Avoid the delay [...]