Why Your Exit Planning Team Needs a Business Valuator

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Why Your Exit Planning Team Needs a Business Valuator

An independent business valuation is critical to your exit planning for many reasons. After identifying your goals and determining your financial needs, a current business valuation is the next step in the exit planning process. Other independent sources also recognize the importance of a business valuation in exit planning: “At present, being able to measure the value of the business is a critical aspect of the business succession plan.” CFIB Research, November 2012 “It is important to get a professional business valuation, since owners may grossly overestimate or underestimate the value of their business.” RBC Business Succession Planning: Your Essential […]

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The Family Business Advisor – A Key Member of the Exit Planning Team

Will the next generation want to carry on the business after you are gone? If so, are they capable? How many family members are dependent on or involved in the family business? Will the business survive a transition to the second generation? How about the third? Is a third party sale to a financial or strategic buyer an option? If these questions have crossed your mind, you may benefit from having a discussion with a family business advisor experienced with best practices that can make a significant difference to both your business and family in the exit planning process. I […]

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Contemplating an External Sale? Do Not Proceed Without an M&A Professional!

A seasoned M&A professional with experience selling similar businesses can help with positioning your business for sale, finding potential buyers, managing the entire sale process and representing you in negotiations with potential buyers. I recently sat down with Don Hilton, Founder and Managing Partner, of Distinct Capital Partners Inc. (www.distinctcapitalpartners.com) in Toronto, Ontario. Distinct Capital provides investment banking, corporate finance and advisory services to shareholders of owner operated businesses with revenues between $5M to $100M. Don has over 30 years of experience in investment banking with several Canadian investment dealers and has worked closely with business owners to assist them […]

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Why You Need the Right Lawyer on Your Exit Planning Advisor Team!

Can your corporate lawyer assist with your exit planning efforts? Perhaps. Does your corporate lawyer have experience collaborating with other professional advisors and working with privately held business owners on the various issues involved in the exit planning process? I wanted to find out why business owners should have a lawyer on their exit planning advisor team, in particular to understand: a) how to select an appropriate lawyer; and b) what the lawyer’s contributions to the exit planning process will be. In order to do so I sat down with David Shlagbaum and Errol Tenenbaum at Robins Appleby & Taub […]

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The Family Business Advisor – A Key Member of the Exit Planning Team

Will the next generation want to carry on the business after you are gone? If so, are they capable? How many family members are dependent on or involved in the family business? Will the business survive a transition to the second generation? How about the third? Is a third party sale to a financial or strategic buyer an option? If these questions have crossed your mind, you may benefit from having a discussion with a family business advisor experienced with best practices that can make a significant difference to both your business and family in the exit planning process. I […]

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Is Your Distribution Company in Trouble? How to Add Value as a Distributor

If your business survives on the basis of being a distributor for one key supplier (i.e. selling another company’s product/service), it may be time to rethink your business model or, at the very least, rethink the way you view your business. When was the last time you used a travel agent, went to a CD store or rented a movie from the local blockbuster? Travel agencies have yielded to the rise of online travel booking companies. CD stores have succumbed to online music services such as iTunes. DVD rental stores have surrendered to the convenience of on-demand movie rentals. These […]

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The Mile Wide Trap – A Value Killer

If your revenue starts to plateau after a period of rapid growth, you may have fallen into The Mile Wide Trap – not a good situation if you are looking to maximize the value of your business. To illustrate, consider a public relations (PR) firm started by an entrepreneur who originally spent ten years learning a variety of marketing disciplines (e.g. PR, advertising, direct marketing, social media, etc.) as an employee at a big advertising agency. Given her experience and connections, she quickly landed General Motors (GM) as a client and was asked to handle certain regional dealer events. Her […]

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Exit Planning Doomed to Fail Without Effective Collaboration

Last week, I had the privilege of speaking at the CICBV 2013 Eastern Regional Conference on the issue of business valuation and exit planning in light of the unprecedented transfer of business wealth expected over the coming decade. [1] Our panel, moderated by Bill Vienneau, Partner at WBLI, Chartered Accountants in Halifax, consisted of Doug Bruce, VP Research at the Canadian Federation of Independent Business (CFIB), Trevor Allibon, Manager Subordinate Financing at the Business Development Bank of Canada (BDC) and myself. Doug discussed some of the recent CFIB survey results in the area of business succession. Trevor addressed some of […]

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The Final Step to Reviewing a Business Valuation Report – Consult a CBV

You have now completed your review of a business valuation report by considering: The type of valuation report; The author’s credentials and qualifications; Any scope limitations underlying the conclusions; The valuation approach(es) adopted; The reasonableness of the projected cash flows or historical normalization items; The reasonableness of the discount rate, capitalization rate or valuation multiplier; Any redundant assets owned by the business; The income tax implications; and The overall reasonableness of the value conclusion. The final step involves consulting an independent Chartered Business Valuator (CBV). In the context of a legal dispute (e.g. commercial, shareholder or matrimonial dispute) this step […]

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The Final Step to Reviewing a Business Valuation Report – Consult a CBV

You have now completed your review of a business valuation report by considering: 1. The type of valuation report; 2. The author’s credentials and qualifications; 3. Any scope limitations underlying the conclusions; 4. The valuation approach(es) adopted; 5. The reasonableness of the projected cash flows or historical normalization items; 6. The reasonableness of the discount rate, capitalization rate or valuation multiplier; 7. Any redundant assets owned by the business; 8. The income tax implications; and 9. The overall reasonableness of the value conclusion. The final step involves consulting an independent Chartered Business Valuator (CBV). In the context of a legal […]

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