Did you know that 51% of U.S. small business owners are set to retire in the next 15 years? That is one scary future!
70.4 million baby boomers are retired or getting ready to retire and with 2.9 million of those being small business owners, that means that each one needs a plan to exit, with most not having a clue on how to do that.
Small businesses employ just over 47% of the nation’s workforce and are the backbone of the U.S. economy. What will happen when boomer business owners either decide to exit and retire or pass away? It’s a thought that weighs heavily on my mind. What’s going to happen to their legacy? To their employees? To the assets?
We make plans for everything else in life, but how to transition your business seems to come late to the table. We plan how to start our business, how to grow our business, and how to exceed our customers’ expectations, but somehow planning when and how you step away from your business ends up as something to think about “in the future”.
The “future” always seems so far out, but for so many small business owners, that future is here and there is no plan.
How big is this problem? Some estimate that as many as 30 MILLION jobs are at risk. These companies contribute over $6 Trillion to the U.S. economy. The U.S. GDP for 2021 was $23 Trillion. Just over one-quarter of this amount could be gone by the actions or inactions of a single generation.
So what do they do? For many business owners out there who don’t have a plan, they simply cease doing business, and all their time, energy, and hard work simply disappear as if they never existed. Workers are suddenly unemployed and cut loose to hopefully locate a new position somewhere else and revenue that helped fuel their local, national, and world economy no longer is there.
A small percentage of businesses can transition ownership and day-to-day operations to the next generation within their family, but that still requires time, training, and a whole lot of faith in your children or grandchildren, to have the knowledge and the skills to continue to grow and maintain your legacy.
For those not fortunate enough to be able to leave their legacy in the hands of family, there is a great option! Sell your business to a buyer who is passionate about your industry and is looking for a thriving business to invest their money, time, sweat, and tears into. Selling to someone who can take what you’ve created and not only have it survive but thrive is a must. Finding the right buyer ensures that your company is in a safe pair of hands to protect your legacy, your customers, and your loyal employees.
To learn more about how to prepare your business to sell, a great place to start would be www.how2exit.com where we’ve interviewed dozens of experts on this topic. Come check it out now! https://www.linkedin.com/in/ronskelton/ If you have further questions, please feel free to contact me on LinkedIn.
*Resources: US Census Bureau & Bureau of Economic Analysis