BUSINESS PLANNING

MAXIMIZING THE VALUE OF THE SALE OF YOUR BUSINESS

Stearns Financial has worked for over three decades helping many business owners plan their sale, prepare the business to maximize value and provide a clear path from sale to financial independence and help in the transition to the next phase of their life.

Here are the top 10 frequently asked questions by business owners we’ve worked with who are contemplating the sale of their business:

  1. Will sale proceeds after tax be enough for my family and me to live comfortably? What expenses does my business currently cover that would be personal expenses going forward? Will my spouse be happy with the end result?

  2. If I delay the sale of my business for a few years, what are the benefits and risks? Is now an optimal time to sell? Is my business “sale ready?”

  3. What investment strategies are most likely to help me with both income and future inflation protection? How can I protect against downside risks?

  4. If the sale is cash plus a note or earn out, what would it mean to my personal situation if part of the proceeds are never paid? How can I maximize the potential for getting full sale value?

  5. How should I handle the due diligence process as the buyer kicks the tires? What should I disclose? How do I prepare my senior team for the sale?

  6. What are my options to compensate loyal team members before or after the sale? What are my options to reduce income taxes on sale?

  7. What will I do with my life after the business sale?

  8. Should I consider a consulting arrangement? Buying another business? Should I consider a tax-free exchange for my business real estate?

  9. How should I change my estate plan as a result of the sale?

  10. What risks do I need to hedge in the future without the business in place?

SFG helps you answer these questions and more.

SFG’s Financial Independence Roadmap℠

As part of our multi-pronged approach to helping business owner clients develop a smooth exit strategy, Stearns Financial develops a multi-scenario Financial Independence Roadmap℠ of your potential future course based on current economic conditions, assets, liabilities and your individual goals.

Our process helps put business sale scenarios into clear focus and sets the stage for pro-active
(versus reactive) financial independence planning, potential income tax savings techniques before and after the sale (developed with your accountant and tax attorney), estate planning developed with your estate attorney), risk management and other key planning needed for the next chapter of your life.

Typical Roadmap business planning scenarios:

  1. Base Case – How does my future look? Sale of the business based on expected value or letter of intent.

  2. Partial Sale – What will my personal situation look like if a cash plus note or earn out is successful? What if only part of the note or earn out is paid?

  3. Tax Planning Scenarios – Enhancing the base case with tax savings techniques.

  4. “What if?” Fire Testing – Risk management scenarios in a variety of negative economic, investment and general risk events.

  5. Estate and Gifting Scenarios – Alternative scenarios for business owners who want to gift a portion of the sale proceeds now or later to family or charitable entities.

Why Stearns Financial?

We know the issues that business owners face. Our firm has been recognized on such lists as the Triad Business Journal Fast 50 (2016) and the INC. 5000 (2016, 2017). Our leaders have also earned awards including Greensboro Chamber Small Business Advocate (2009), Business Leader Entrepreneur of the Year (2008) and Triad Business Journal Most Admired CEOs (2016).

Stearns Financial utilizes scenario planning. We look at plausible scenarios for you, your business and overlay our own proprietary economic scenarios. This helps both you and SFG understand the strengths and weaknesses of your situation and how best to chart a course to your preferred future.

Stearns Financial is constantly a fierce advocate for our clients. We are professionals, not financial product salespeople. We have credentials like CFA, CPA and CFP®, and regularly participate in “best practices” workshops for regional and national conferences in the financial industry. Our firm is a fee-only (not fee-based) fiduciary. SFG has been named seven consecutive years (2014-2020) to the Financial Times 300 Top Independent Registered Investment Advisors in the U.S.

Plan Ahead. Play Smart.

The Financial Times Top 300 list is not indicative of future performance. Individual account experience may vary. The Financial Times Top 300 Registered Investment Advisors is an independent listing produced by the Financial Times. The FT 300 is based on data gathered from RIA firms, regulatory disclosures, and the FT’s research. As identified by the FT, the listing reflected each practice’s performance in six primary areas, including assets under management, asset growth, compliance record, years in existence, credentials and accessibility. Neither the RIA firms nor their employees pay a fee to the Financial Times in exchange for inclusion in the FT 300.
The Triad Business Journal’s Fast 50 is an annual ranking of the fastest-growing privately held companies in the Triad (i.e. Greensboro, High Point and Winston-Salem, NC) based on revenue growth over a three-year period.
The Inc. 5000 is an annual ranking of America’s fastest-growing private companies based on percentage revenue growth over a three-year period. The Triad Business Journal’s (TBJ’s) 2016 Most Admired CEOs is not indicative of future performance. The TBJ Most Admired CEOs honors the Triad’s outstanding business leaders. The honorees are selected among local CEOs and company presidents at both nonprofit and for-profit organizations, including both public and private companies. Nominees do not necessarily have to carry the title CEO, but they must be the top executive for their organizations. Honorees are chosen by TBJ designated judges from a pool of online nominations. Those chosen for the honor will have demonstrated vital leadership and a customer service philosophy, outstanding employee relationships, contributions to the community and evidence that they have shaped their company’s products or services to help lead their business to success.