Is Your Answering Service Your Retirement Plan?
May 16, 2018
For many business owners their business is in effect their retirement plan. Yes, they do have a SEP or IRA, but most of their assets are tied up in their business.
When it comes time for you to retire, you want to sell your answering service for the best possible terms in order to provide you with the best possible retirement. Follow these tips to retire well:
Structure to Sell: Many entrepreneurs operate multiple businesses or have secondary businesses (or product lines) nestled inside a primary one. Separate all businesses and business lines so that they are easy for a buyer to evaluate and easy for you to sell one part without making a mess of what’s left. In addition to making financial delineations, look at staffing and other shared resources, such as the business name, website, phone numbers, and so forth.
Cultivate Buyers: Network with potential buyers within the industry. Look for people you respect and who share common values, in addition to having the wherewithal or history of acquiring other answering services. If you have a family member or key employee who is a potential buyer, discuss this with them, make a plan, establish expectations, and set a timetable. It’s never too early to groom them to take over.
Seek Financial Advice: Meet with your financial advisor and accountant early on to determine how to best structure a sale to meet your retirement needs and minimize your tax liability. Waiting until after the close is too late, and trying to figure these things out in the middle of negotiations, makes the discussions more problematic than they need be.
Maximize Valuation: Always look for ways to increase the value of your business. In most all cases anything you do to boost the appraisal of your answering service will also have a near term payoff of increased profits.
Look to make every client profitable. Stay on top of collections. Optimize operations. Document processes. Simplify complex procedures. Resolve loose ends. Ensure each employee contributes to your answering service’s overall financial success. Get rid of dead weight and unprofitable services.
Be Ready to Act: Simultaneously keep two thoughts in mind: First, operate in your best long-term interest as if you will own your answering service forever. Second, always be ready to sell. By holding these two dichotomies in constant tension, you are most apt to have your answering service positioned to sell at a moment’s notice, while avoiding the potential of coasting, which will lower your valuation. Each week, act in the long term while being open to commence sales negotiation.
Follow these steps to move from answering service owner into retirement with the best financial outcome possible. It’s never too early to prepare for your future. Start today.
Janet Livingston is the president of Call Center Sales Pro, a premier sales and marketing service provider and consultancy for the call center and telephone answering service industry. Contact Janet at firstname.lastname@example.org or 800-901-7706 to arrange a private consultation about buying or selling an answering service.
Peter Lyle DeHaan is a freelance writer from Southwest Michigan.
Use an Answering Service to Block Out Time
People at all levels of business, in all sizes of businesses, struggle to find time to focus on key projects. Nowhere is this more critical than for e...
Selling a Distressed Answering Service
Prior posts have addressed the right time to sell your answering service, the wrong time to sell, and about leaving a legacy when it’s time to move ...
Why Insisting on a Stateside Call Center is an Ill-conceived Goal
When people reach a call center, they make assumptions about the agent and the agent’s location based on what they hear. While these assumptions may...
Use an Answering Service to Better Serve Callers
When someone calls your office, what happens? Don’t answer this question with what you hope happens or what you ideally want to occur but with the t...
7 Steps to Deal with an Underperforming Answering Service Sales Rep
If an answering service has sales reps they either produce consistent sales month after month or they underperform. Too often sales reps underperform....
A Professional Billing Service Provides Added Value to Answering Services
With the right software, anyone can generate telephone answering service invoices—and get them mostly correct. Yet it takes a company with unique in...
Use an Answering Service to Back-up Your Staff
In today’s fast paced business environment we all have more to do and less time to do it. Too often something needs to give. We skip some aspects of...
Use an Answering Service to Handle Your Office Hours Calls
Most everyone knows that answering services are great at answering the phone in the evenings and weekends, but they can also answer your phone during ...