The cost of waiting


If you wait until the last minute to plan for selling your business to management, you might not get the full value for it. This is because you probably haven’t prepared the buyers for the lenders due diligence. Plus, if you rush the sale, you might not be able to negotiate the best deal, which could result in a lower selling price.

Generally, a last-minute sale mean that you have to accept payment in instalments instead of getting the full amount upfront. This can be risky because the buyer would have control, the business might not do as well as expected, which means you might get less money in the end.

To reduce these risks, it’s a good idea to plan for the sale of your business well in advance. You should talk to business succession experts who can help you prepare your business for sale, figure out how much it’s worth, and prepare a business succession plan to get the value you want.


Hi, this is Byron speaking to you today

from the banks of the Rio Grande River,

just north of Taos New Mexico.

I want to talk to you today about

the cost of waiting.

The cost of waiting and preparing

yourself in your company for the orderly

transition of your ownership to your

management team means that if you wait

to put together a plan,

you end up assuming all the risk of

getting paid.

What I mean by that is that the most common

plan for transition to management is the

10-year seller finance installment note.

So, the seller who decides they want out of

their company calls their advisor.

The advisor asks “Does your buyer have any

money?”. The seller

suggests “No”, so the advisor says “well,

it’s like you’re going to finance it and

the most feasible terms in the

transaction like that is 10 years”. So, the

seller in effect gives up control or

near control of their company and in

return, gets one tenth of the value of

their company in the year in which they

give up control.

As opposed to thinking ahead five or

seven years and preparing your buyer to

become bankable, which means that when

you change control, you would receive


So the cost of waiting is the timing in

which you get your cash and the amount

of risk you have to take after you

transition control.

One of the rules of thumb in

transitioning control and its well

ordered succession plan is you don’t

transition control until you’ve realized

financial independence.

Don’t miss the opportunity of your lifetime.

Schedule a Meeting Now

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