By JIM KENDALL
This material originally appeared as one of Jim’s Daily Herald columns
End game is such a final term. Yet when Downers Grove business advisor Harry McCabe talks about your business’ end game, the topic nestles nicely into the planning each business owner should do.
“When you’re starting up,” McCabe says, “SCORE is big on business plans. What I’d like is for that plan to include one or two paragraphs on what the end plan will be, how to get out of the business.”
SCORE, once known as the Service Corps of Retired Executives, is a non-profit association with 350 or so chapters across the country and status as a resource partner with the U.S. Small Business Administration. SCORE provides mentoring and seminars, mostly free, for business owners.
Locally, Fox Valley SCORE serves businesses in DuPage, DeKalb, Kane, Will, Kendall and McHenry counties; SCORE Chicago does the same in Cook and Lake (IL) counties and part of Will.
There are other sources of start-up (and on-going) advice: Your accountant or attorney; Small Business Development Centers that so far have managed to survive their state-induced budget crunch; and paid advisors are among the options.
Whether SCORE is involved or not, McCabe’s point is that whatever business planning a business owner does should include what others typically call exit planning. End game planning may be especially important in family business situations, where relationships can be murky.
Whatever it’s called, the need to plan for the eventual transition of your business from you to – well, that’s the issue, isn’t it? – deserves thought.
Making an analogy between athletes who prepare for a race to the finish line and business owners who should at least have a finish line in mind, McCabe writes, “But what is the finish line? What is the end game? Is it to successfully pass on (the) company to the next generation, partners, key employees or other suitors?
“It might be. But like with any competition, (business owners) need to know what the end game is so they can keep it in their sights.”
Why? “They won’t get there without a plan,” McCabe says, adding as an example that a written end game plan can be especially helpful if a business-changing disability strikes you, a partner or a key employee.
Actually, planning for your business’ eventual end game isn’t necessarily difficult – and with honest discussion often becomes logical. If there is more than one owner, entrepreneurs “need to get a preliminary plan in place – a shareholder agreement” that spells out transition and succession if that becomes necessary,” McCabe says.
Keep in mind, however, that any plan will change as the business changes. “You may take on new partners,” McCabe says. “You may introduce a new product line that will change the competitive situation, or new competition may arise that will lead to changes.”
Other advisors – some of whom, such as a financial planner, may already be on your personal team – normally will be involved in the McCabe process.
© 2017 Kendall Communications Inc. Follow Jim Kendall on LinkedIn and Twitter. Write him at Jim@kendallcom.com. Listen to Jim’s Business Owners’ Pod Talk at www.kendallcom.com/podcast.