About to retire and hand the reins to a successor? Whether it’s someone close or a third party, ensuring the long-term viability of your company takes a structured transfer approach. A well-prepared plan ensures your company is transferred to a qualified successor with your legacy intact. Here are a few tips to get you started.

Know your business

It is essential to have a solid overall understanding of your business strategy and competitive environment. A clear take on your market and its challenges makes for faster, easier decision-making throughout the transfer process.

Choose wisely

You are invested in your company, and it has a positive effect on society, so it is very important that the transfer allow that to continue. Make sure the values of your business successors are in line with your own and that their objectives will promote the company’s long-term viability. With investments in a wide range of industries across Quebec, Desjardins Capital is a partner who can provide the support you need and, in particular, introduce you to a number of potential buyers before you make your final decision.

Opt for transparency

Transparency allows you to skirt a a number problems that arise during the transfer process, the most significant of which is determining the the sale value your company. It is easier to agree on value when it is assessed in a transparent and independent manner by a a business valuator (BVA) qualified by the Canadian Institute of Chartered Business Valuators

Stay in control of the business

Sellers are often unable to take part in the sale process due to the buyers’ financing structure. Private equity funds, for example, typically take control of management to ensure a successful transaction. Yet, we know from experience that entrepreneurs with a significant impact on their company’s business development play a positive role in supporting a smooth transfer of power. In addition, by choosing a financial partner with a more collaborative approach, sellers ensure that their management team maintains control of the company under structured supervision.

Get an outsider’s point of view

For business transfers to family members, the bonds between senior executives can be more emotional, making certain decisions can be hard to make. Involving an external partner in these cases can make things a lot easier. Third parties are able to ask hard questions and defuse certain situations more effectively and without taking sides, which will greatly accelerate the transfer process and avoid conflict.

Regardless of the circumstances, business transfers are complex processes that require careful planning. Entrepreneurs should therefore allow a minimum of five years’ preparation before contemplating closing a deal.