A gap exists in today's marketplace for advisory services to retiring business owners. The under-appreciated need for Business Exit Strategy Planning offers the next big opportunity for advisors to grow, and protect, their franchises. It positions an advisor with this special group by delivering planning-based solutions to address a most critical decision: how to Exit the business.

'Illiquid' wealth is still wealth in need of management.
Business owners are the overachievers of society--and statistically the wealthiest. They live a certain lifestyle 'within' their businesses, which they can maintain only if they convert their 'illiquid' assets into 'liquid' wealth. Most owners possess little information on how to design a Business Exit Strategy. Investment advisors are therefore in a unique position to become a resource, thereby raising their 'trusted advisor' status with business owner clients. Advisors might traditionally deal in 'liquid' wealth, leaving the 'illiquid' business concerns to the investment bankers. But keep in mind, assets are assets, and the 'illiquid' becomes 'liquid'. For the aging Baby Boomers, this Exit decision is coming sooner rather than later.

An untapped growth niche.

According to a 2002 NFO WorldGroup study, the number of retiring business owners is expected to grow from 50,000 per year in 2001 to 750,000 per year by 2009. This suggests that a massive wealth transfer has begun, in which pro-active advisors can position themselves to participate. Many of these business owners are already clients or prospects.

Imagine the valuable service an advisor can provide--and additional fees one can earn--by practicing Business Exit Strategy Planning. Clients prefer to work with more than one (1) financial advisor during their 'accumulation phase'. But during the 'distribution' - or 'Exit' - phase, that client needs one trusted advisor to devise an 'income replacement' strategy, one (1) of many steps toward a successful Business Exit. So, this trusted relationship hinges on the ability of an advisor to help the client reach all of their financial goals. Why wait for a savvy competitor to lure a client away with a comprehensive set of Exit Strategy solutions? Take action by combing your list of clients for private businesses owners. Great opportunities don't remain secret--the increase in our Memberships testifies to the growing awareness of this practice area.

Start the process with an open dialogue.
Begin by asking a series of three (3) questions. Make sure to approach with care; an owner's business exit is a life event of paramount importance. It shouldn't be used as an immediate opportunity to sell other products. Developing a solid relationship and generating an open dialogue is the initial objective.

Question #1--'Have you thought about a business exit strategy? The answer might be 'no' but this simple question will begin a process of reflection and discussion of concerns. It also positions the advisor as an Exit Strategy resource.

Question #2--'What would you like to accomplish with your business exit'? This is the 'wild card', open-ended question. The owner may open up or show hesitation. Either way, it helps focus the owner on the question of 'what do you want?'. Recognize that 'what that owner wants' often mirrors the original motive for starting the business. It isn't a job. It's a lifestyle for the owner and all family and friends involved. The advisor who appreciates this will gain significant 'trusted advisor' status.

Question #3--'Would you be interested in customized Exit Strategy Planning advice? At this advanced point in the conversation, the answer is probably 'yes'. This is where knowledge becomes your guide. For instance, you'll need to understand the transfer options outside of selling the business, which can include a transfer to family members, employees, a charity, co-owners, or a partial sale in which the owner maintains a role in the operation. You will also need to build a network of service providers that can execute the Business Exit. The more knowledge and resources an advisor can provide, the more valuable the advice.

Get educated--take your franchise to the next level.
Every advisor must ask the question; is it worthwhile to become educated about this practice area? Consider that your livelihood depends on the Value of advice. Given the importance owners place on their businesses, Exit Strategy Planning is possibly the most valuable advice one can offer. It distinguishes the advisor as a niche practitioner, better positions the franchise's products, and commands higher fees. So the answer is 'yes'. It is more than worthwhile to become educated about Business Exit Strategy Planning as a means to tap into an underappreciated opportunity for years to come.