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Have You Thought About Your Future Lately?

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What if you are hit by a truck?. Business owners need to think about the effects on their families if they or their partners were suddenly unable to continue to operate their business..

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Have You Thought About Your Future Lately?

  1. 1. Have You Thought About Your Future Lately? by R. Thomas Stocker You are the owner or a partner of your You can make changes to your business that business. When was the last time you will provide you with significantly more thought about the long-term future as the flexibility, options and value than you owner, not as the operator? Where do you currently have. But you need a plan. want to take the business? What’s the next The first step in the process to create a more level? Your end game? Are you and your valuable business is to think about you. Not partners aligned? You may not be able to as the president of your business, but as the justify much owner thought today because major stockholder. Think of your business you have many more immediate worries as an asset. It is the largest asset you own. right now; like getting the next order out. It probably represents 80% of your net So you’ll get to the owner thought process worth. What do you want to do with your tomorrow. You’ll definitely make a little life? How does your business fit in those time to come out of the trees and look over plans? If you are like 98% of the owners the forest tomorrow. Not! reading this article, it probably represents When will tomorrow come? Tomorrow may the greatest portion of your retirement never come, until suddenly it’s here today. lifestyle. Perhaps a competitor or investor makes an Can you give a two-minute elevator pitch unexpected offer for your business. Your about where you and your business are son or daughter, whom you thought was going to be in eighteen months, three, five or going to run the business when you were ten years? No? Then start with a one done, tells you the family business isn’t in minute pitch. Can’t do that either? Better their plans. Or they decide to leave the get on it, because if you can’t articulate it, business because you haven’t done anything it’s going to be really hard to get others to to help them understand when you will be help execute it. Certainly not your ready to give up control. Maybe you are the employees, they don’t have the map. In business. You woke up this morning and fact, chances are they’ve never even seen it realized you are not having fun anymore. if you haven’t talked about it. Your advisors The juices just aren’t flowing like they used can’t, although they are trying to do their to. There are lots of scenarios that can give best to do what they think is right for “your you a wake up call. Hopefully you realize situation”. you need to plan as an owner before it is too late. Your lawyer, banker, accountant and wealth manager are all trying to help based on the What does “too late” mean? It means the piece of your personal pie they are familiar options you will have when it is time to with. Most are involved with your finally exit your business will be limited. It business in some way, providing counsel on may also mean the business is not as contracts, patents, taxes, credit lines and valuable as you were counting on for your countless other things you ask them to do. retirement. Unfortunately, this happens all But most of that work is done for today’s too often. But it doesn’t have to be this way. business and not necessarily helping you 10 Larkspur Road, East Greenwich, RI 02818 401-451-9799 www.boardroomadvisorygroup.com
  2. 2. drive toward long-term value. However, if lifestyle today instead of investing for they are trusted advisors, you’ve probably growth and value, you may be destroying provided at least a glimpse of your personal the long-term value of your company. And plans and timeline. clearly that’s not good. Not only for you and your family, but it will also hurt your Your wealth manager wants to help you, but employees and our communities. they can only work with your stocks, bonds, insurances, 401Ks, real estate and whatever Your personal timeline is very important in other liquid assets you may have. Your determining how much long-term value you business is illiquid right now, but they are can achieve. If you are looking for an exit providing future value projections to come in six or eighteen months, the urgency and up with the answer of “what you need to things you can do are significantly different retire”. You’ve provided the projections, than someone who has a five, ten or twenty but there may be a problem if you based year horizon. But no matter what your them on flawed valuations. If you have an timeline may be, you really need to get the unrealistic sense of your business’ current process started. value, and many owners do, or you don’t So do something about the question. The have a solid strategic plan for the business to one you haven’t taken the time to formalize get there, you are fooling yourself. And that yet? What are you doing today to drive your is not good for you or your family. Fact: business to enhance long-term value? Sure your business is not and will not ever be you’ve got it in your head, but you need to valued on “what you need” by any outside put it on paper, or at least be able to party. So be careful. articulate it. Take your CEO hat off and put The value of your business doesn’t just your owner hat on every day. Start happen. You drive it. If you are running practicing your elevator pitch. You’ll be your business for today, focused on surprised how this may help you build a minimizing today’s taxes, taking cash out or valuable business. whatever other things that may enhance your To comment on this or other topics important to private business owners, access my blog at www.boardroomadvisorygroup.com. About the author; Tom is a Principal of Boardroom Advisory Group, LLC, an owner advisory and consulting firm. Tom serves on the Board of Directors for the RI Economic Development Corp’s Small Business Loan Fund Corporation (SBLFC), the finance arm of the RI EDC. He writes a monthly article for the RI EDC’s Every Company Counts initiative. His articles focus on areas that can add significant value for business owners. Contact Tom directly at 401-451-9799 or tstocker@boardroomadvisorygroup.com. Boardroom Advisory Group, LLC is a business advisory and consulting firm specializing in helping business owners resolve day-to-day systemic issues that interfere with cash flow and profitability attainment. The Firm works with both growing and underperforming small to mid-market private companies. The Firm’s team of hands-on senior professionals find and implement solutions to improve top-line and bottom-line growth, increase cash flow, reduce costs, improve process, structure, and use world-class metrics to keep the business on track. The team also has extensive experience working with troubled companies through business restructures and recapitalization. Boardroom Advisory Group’s core focus on developing strategies to drive and measure performance has resulted in a history of sustainable top and bottom line growth, healthy cash flow and increased company value for their clients. For more information about how we can help you build a more valuable business visit our website at www.boardroomadvisorygroup.com. ©2008-09 Boardroom Advisory Group, LLC All Rights Reserved. No part of this document may be reproduced without the express permission of the author. All registered trademarks mentioned in this document are the property of their respective owners. Additional articles written by Mr. Stocker include: Start Forecasting Now! Do You Have Contingency Plans? I’m Out of Compliance. Now What? Have You Thought About Your Future Lately? Are you in a Foxhole? Metrics Should Be Everywhere (Part I) Are You an Octopus? Metrics Should Be Everywhere (Part II) What is Value? It’s All About Growth
  3. 3. These articles can be accessed at www.boardroomadvisorygroup.com/pages/pubs.php. You can also request to be added to his email list to receive his latest articles on a monthly basis on the Company website. Contact Tom at tstocker@boardroomadvisorygroup.com.

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