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“We have to meet the business owner where they are actually at and work from there. They aren’t a nail and I’m not a hammer. We have to be more creative and recognize every business owner comes to this conversation on his or her own terms.” – Martha Sullivan, Founder at Provenance Hill,
Every business owner begins the entrepreneurial journey from a different starting point. Too many advisors put the client in a box and present them with the same solution they bring to everyone, regardless of what the client’s business is. This includes advisors who help business owners navigate exit plans to transfer ownership or management of the business or to close it in an orderly fashion.
One size does not fit all. The most effective exit plans are tailored to the needs of specific clients and their businesses. This article explains 6 ways to become a more successful exit planning consultant.
Especially when you handle multiple clients at the same time, you tend to apply the same or similar strategies to all of them. After all, you don’t want to reinvent the wheel, right? As a result, the outcomes become predictable and clients begin to view you as generic: a one size fits all solution. If you wish to stay afloat in this business, you need to be creative and craft exit plans unique to each business.
Unless you provide service only to a specific niche and know it inside and out, you need to do your research to understand how the business works. Every business niche has its own sets of problems, benefits, and protocols. As an advisor, your job is to help each specific business maximize its potential given its available resources. Your job also includes safeguarding it by creating a suitable exit plan.
Begin by understanding how that business operates. Fortunately, you will always find a company that does the same thing as your current client. Therefore, use that other company as a model, either for what to do or what not to do.
An ideal consultant finds the right balance between investing in something new and utilizing what you have already. Remember that your client will want an explanation of every expense you make. Be prepared to justify each expense and maintain meticulous records. Every expenditure must fulfill a purpose, so choose wisely.
Sometimes, you may find yourself in a position when every deal or option seems lucrative. However, you can’t have everything. Too many choices can disrupt the entire planning endeavor. If that happens, you may not be ready for an exit plan. If and when there comes a situation when you face a ton of options, analyze the pros and cons of each before you commit.
Don’t look for a master key to unlock all the problems a business might face. Sadly, there is no such thing in the exit planning business. Therefore, your best strategy is to dive deep, do your research, and come up with unique solutions applicable to that particular business.
As mentioned earlier, you can draw references from other businesses to create an exit plan. However, you cannot replicate that example for every other client with whom you work, whether your client operates within that business niche or a different one. The solution that fits your client’s needs is tailored to that specific client.
When you are trying to carve out an ideal exit plan, focus not on just the usual aspects, but also the unconventional issues that particular business may face. Your ability to detect a comprehensive list of existing and potential problems depends on the thoroughness of your research.
Some additional steps we suggest you should take while you are crafting an exit plan include:
When the business must make necessary changes and is not in a position to do so, the situation gets complicated. Reasons for that inability to make those changes range from shortage of funds to a lack of properly skilled employees. Whatever the reason, not every business is ready for a transition.
In such a situation, the options are limited. Any solution that works to sustain the business or improve its financial stability and value requires creativity. Again, do your research and study similar businesses that conquered similar circumstances to find that middle ground where your client can break even.
By now, you understand the purpose of thorough research. You can’t just scratch the surface and hope for deep comprehension and insight. What you need to do is to dig deep. For that, spend time inside the company premises and observe how the company operates. Ask your client questions. Find the flaws within the business as well as the strengths. Study other companies undergoing similar transitions. Analyze the data and formulate your hypotheses.
Soon, you should clearly distinguish why one model or operation works, while another doesn’t. Only then you can create the ideal exit plan for your client.
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