Small Business Series Recap – Preparing Your Business for a Successful Transition

On Thursday, August 12, BRAC launched the first in a series of webinars, Planning Beyond the Pandemic, targeted towards a critical audience in Louisiana: privately-owned businesses held by those of the baby boomer generation. Privately-owned businesses account for over $30 trillion in sales in the United States and 60% are owned by baby boomers. Based on surveys, most private-business owners have 80 to 90% of their personal wealth locked in their business.  

Eventually, every owner must transition their business to family members, to their employees, or to a third-party investor. These founders deserve to receive the maximum value for their business. The first installment of our small business series, led by business transition expert Bob Marquette, charted out a path for successful business transition. 

The first step to creating the maximum return for a business owner is effective and proactive planning. Owners are advised to start planning at least 3 years ahead of the desired exit date, but 5 to 10 years is even better. The actions a private business owner takes now to improve the value of their business for a transition will improve the performance for today. 

Planning begins with defining the exit objectives and building an action plan with specific dates. One of the most important metrics to track is operating income — a business’ valuation is typically calculated by a multiple of operating income. 

Buyers value businesses based on their future earning potential. It is critical that private business owners can demonstrate a strong pipeline of business growth. Owners should focus on growing top line revenue, the margin rate, and the cash flow of the business.  

Here are 10 steps to drive profitable growth and prepare a business to be passed on or successfully sold:  

#10: Implement weekly sales meetings in which all team members are included, and expectations are clearly laid out.  

#9: Develop strong sales reps and sales managers by customizing training to fit each team members’ needs. Build a culture of accountability for delivering results. 

#8: Eliminate performance reviews in favor of creating an environment where managers and salespeople regularly and openly discuss roadblocks, progress, and performance. 

#7: Prioritize customer relationship management by using the right CRM application for the team as a central and transparent record of activity.  

#6: Invest in sales forecasting tools to better understand your future. 

#5: Recognize the variety within your sales team (hunters vs. farmers, outside vs. inside reps) and structure them to maximize sales and add value to your customers. 

#4: Clearly define sales metrics and know the difference between leading indicators (behaviors) vs lagging indicators (results).   

#3: Create a defined sales process with common language, clear steps, check points, and necessary information and inputs.  

#2: Establish compensation plans that incentivize the desired behaviors. Plans should align with company goals and be mutually beneficial for the sales reps as well as the organization.  

#1: Share a detailed business plan across the organization because what gets measured, gets done.  

Be sure to join part two and three of our series on September 30 and October 14. Visit to register! 

Elizabeth Walker

As the Policy and Research Project Manager, Elizabeth Walker provides leadership on initiatives and policies, project management, research analysis and administration for initiatives that advance BRAC’s annual policy agenda.

Scroll to Top