You are considering selling your company for your retirement. But transferring the business is not always enough. How can you plan for it?
When and how to plan the transfer of your business
Before the transfer of the company, the manager cannot neglect all the contingencies. To anticipate a possible loss of income and to ensure the working conditions of the employees. Preparing the transaction is the best way to avoid being guided solely by emotions.
Transfer of business and foresight
It is not uncommon for the entrepreneur to consider the transfer of his firm as his retirement income. Before doing so, it is important to ask yourself some rational questions. Imagine what your expenses and financial needs will be when you stop working. It will be all the easier to calculate if the sale of your company will cover its expenses. The idea is to maintain your purchasing power after the transaction. You will also be able to develop complementary strategies, such as a retirement plan or a new investment, either in furniture or real estate. Of
course, the price of the transaction itself determines your need for additional income. Different methods coexist to determine the value of the business transfer. Put yourself in the buyer’s shoes. If you see your business mainly through the prism of the past – the investments made, the customers acquired, the sales made – whereas a buyer is primarily interested in the future: the expected profitability, the risks, the adaptation of the business to new technologies, etc.
Conditions offered to employees
Planning the transfer of the company can also involve setting up collective benefits, such as a supplementary retirement savings plan or a profit-sharing bonus. These processes allow to keep the active forces within the company. They improve the company’s balance sheet and help to satisfy all stakeholders. However, collective agreements are not automatically transferred. Their preservation after transfer depends on the specific regime of article L.2261-14 of the French Labor Code. A lawyer specialized in business transfers can help you settle these issues.
It is understandable that anticipating the transfer of one’s business also means considering what will happen after the transaction. It is advisable to measure the major impacts and the appearance of new risks on your patrimonial life. Not to mention the tax pressure that the inheritance tax may create, which must also be calculated.
To accompany you in the transfer of your company, call on Actoria France, a team of professionals specialized in the transfer of companies and dedicated to your project.
