Plan your business exit

Business planning and management Brisbane

When you think about ‘business planning’ do you think about it only in terms of planning a business start-up or an add-on venture?

Have you ever seriously thought about how you will exit your business on your own terms?  You are not alone.  It is common to be optimistic and trust that at sometime in the future, a buyer will emerge and offer fair market price.  It is not the reality for many.

It may be that you want your business legacy to live on through family succession.  That too can be a path scattered with unexpected challenges.

Like every other aspect of your business, it takes some smart thinking and hard work to achieve the outcomes you want.  To the best of your ability, you want to leave your business on your own terms, even if that exit is sudden and unexpected.

For more information check out my Exit Plan page at

Dinosaur businesses face extinction

Business planning and management Brisbane

Just as sudden impact and environmental changes killed off the dinosaurs of the past, the GFC has exposed fundamental flaws in outdated business models, and the dinosaur businesses of today continue to reach extinction.   Financial institutions, book stores, property companies, electrical and clothing retailers and department stores (to name a few) are all feeling the squeeze of rapidly changing environment because they are stuck in the past and cater to demands of a bygone era.   They violate one of the fundamental principles of business.

“If you can’t lead the market, at least meet it. If you don’t adapt, you’ll die!”

This is first principles stuff taught in 1st year university business courses.   It’s right up there with revenue being higher than expenses.  It is true that only a few people get to change the world but the rest of us should at least make an effort to keep up.

Open mind and constant learning

Business planning and management Brisbane

Most people in business weren’t experts, or even experienced, when they started.  They spend the early years learning the basic techniques of business.  They make the same mistakes as everyone else and become distracted putting out fires.  It is the school of hard knocks and there is no safety net. Many survive and some don’t.

Those who survive learn from the early years.  They refine their art over time.  They keep the routines that work and discard those that don’t.   Experience helps them navigate the minefield of adversity, errors and setbacks.  They develop a well practiced way of doing things that can be shared with others.  It may not always the best way but it is a way that works for them.

The best in business are the explorers and the curious; those who keep an open mind and are always willing to learn.

Protect the family jewel in the crown!

For quality business planning and management Brisbane

If you think Business Equity Insurance is a low priority in your business planning and a cost you can do without then think again!  In actual fact, it is the one single business protection you can’t afford to be without.

Before reading any further, take a minute or two to read the story of Steve and his architecture partnership to see what can really happen to a thriving business when death, disability or critical illness catches up with one of the owners.

OK, now that you have some perspective, read on …

Your business is one of the biggest investments of your life. It is your family’s jewel in the crown.  Business Equity Insurance is the only way you can preserve its true value.  This type of protection is just as much an investment as your business is and the machinery and equipment within it.

Business Equity Insurance also facilitates the easiest sale of business you will ever make because you will already have the finance and the buyer and the price in place.  It therefore solves your problem of succession when it comes time for you to leave the business.

How does it work?

In a nutshell, you and the other owner(s) of a business have a combination of Life / TPD / Critical illness insurance on yourselves plus a legal sale (buy-sell) agreement.  If one owner dies, becomes TPD or suffers a critical illness, it triggers an insurance claim and the internal sale of the deceased or disabled owner’s share.

The insurance proceeds become the source of finance (at a cost of capital typically < 3%); the able-bodied business partner(s) become the ready buyer(s) and the most recent accountant’s valuation becomes the agreed sale price.  There are no ‘ifs’ and ‘buts’; the sale goes through because modern buy-sell agreements are watertight and tax effective.  Everybody wins!

Unlike your machinery and equipment, you don’t come with a warranty.  No one else is responsible for your original defects or your ongoing lifestyle choices.  Death, disability and critical illness will catch up with you, even if you feel fit and healthy.  Whilst you hope it will be later rather than sooner, it is still only a matter of time. 

I am not being pessimistic or fatalistic. I am speaking from real life and near-death experience!  The only fallback positions you have in life are the ones you create yourself.  Whilst you may not be able to stop nature taking its course, you can make things a hell of a lot easier financially for yourself and your family.

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