“How quickly can I retire, after you sell my company?”, she asked
I said, not right away. She looked down, then up at at me and said, “but I really want to retire, my sister retired, by best friend retired, everyone my age seems to be retiring.”
I get it. Business owners work for years, maybe decades and they want to retire like their non-business owner friends are all doing.
But those people can quit their jobs and retire, you can’t just quit your business. You can sell it, but only when it is ready to sell.
Remember that last point, “when IT (your business), is ready to sell”.
So, if you sell your business, how quickly can you leave?
Sorry, but it depends on a lot of things.
If you own a small retailer and are selling to your manager, you may be able to leave in a matter of weeks. But, be prepared for a lot of calls and emails over many months.
If you own a small manufacturing company with a variety of loyal customers, you may need to work for a year or more.
Why? Because those customers may be more loyal to you than your company. The buyer will insist on you working to transition those customers to them.
Some buyers will be competitors, who know your industry well, and can get up to speed fairly quickly, but want to tie you financially to a successful transition, with earn-outs, seller-financing, consulting agreements and more.
Some buyers may have great adjacent knowledge, but need help learning your systems, customers etc.
Some buyers have a good management background at a larger firm, but will need you for longer to transition employees, vendors and customers.
So, what’s the right answer to this owner’s question?
Expect to help your buyer in some capacity for 6 to 36 months. It all depends on how you prepared your business for a transition, your staff, the market, the deal and your buyer.
Selling a business is not like attending the closing on a house and getting your check (or bank wire).
It is a months-long process.