Client Background
A third-generation family-owned manufacturing business specializing in custom metal parts was preparing for the owner’s retirement. The owner wanted a structured exit plan to ensure a smooth leadership transition and maximize business value before selling. The client hired Development Theory to help with an exit plan for a manufacturing business.
The Challenge
No Clear Successor: The owner’s children were not interested in taking over the business.
Outdated Business Valuation: The owner had no recent valuation to determine the company’s worth.
Tax Liability Concerns: A business sale would generate significant capital gains taxes.
Employee & Customer Retention Risk: Transition uncertainty risked employee and customer loyalty.
Our Approach
Business Valuation & Value Growth Strategy: Performed a market-based valuation and identified key value drivers to increase the sale price.
Successor & Buyer Search Strategy: Developed a sale strategy targeting industry buyers and private equity firms.
Tax Minimization Planning: Structured the sale using installment payments and asset sales to reduce tax liability.
Employee & Customer Retention Plan: Created a transition roadmap to maintain workforce stability and customer trust.
Legal & Financial Structuring for Sale: Coordinated with legal and financial advisors to ensure a smooth transaction.
The Solution
Increased business valuation by 22% before listing for sale.
Found a strategic buyer willing to retain key employees.
Structured the sale to reduce capital gains taxes by 30%.
Maintained customer and employee stability, ensuring business continuity.
Results & Impact
Business successfully sold for $8.3 million, exceeding expectations.
Owner reduced tax burden by $650,000, increasing net proceeds.
Key employees retained, preventing operational disruptions.
Customer relationships preserved, ensuring ongoing business success.
Client Feedback
"I had no idea how to sell my business without major tax losses. This exit plan helped me retire comfortably while ensuring my employees and customers were taken care of!"
Development Theory Can Help Business Owners Like You
Looking to retire one day like this business owner? Our Exit Planning service provides you with an estimate of your business's current value and insights on how to leverage that value to retire. Don't miss out on the opportunity to plan for your future.
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