Exit Strategies Tactics to max out your end game

News / Views / Insights / Commentary

Each day, EndGame Success considers dozens of breaking hard- and soft-news stories, selecting only the most important and reliable for inclusion. Watch for illuminating comments by our curators.

What Keeps Your Good People... Yours

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Companies have long recognized the importance of smart employee recruiting. Now they are discovering that it’s just as important to spend their time on retention. [And, if it's time to implement the exit strategy, retention could be the difference between an excellent price or a mediocre offer.

 

Sourced through Scoop.it from: www.business2community.com

This straightforward article could be a wake-up call. At EGS, a core principal of company valuation is retention. Every exit solution needs to address how to keep the key employees... employed.

 

Franchisees: What's Your Exit Strategy When You Are Ready to Move On or Retire?

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All too often, eager entrepreneurs tend to overlook the bigger picture of their promising careers as business owners, foregoing the process of planning an exit solution. WRONG!

 

Sourced through Scoop.it from: franchisepod.com

Franchisor Minuteman Press goes far beyond the extra mile for their franchise customers. They actively counsel exit solutions from the beginning, keeping the end in mind (as EGS strongly advocates). Very good article.

 

Column: Exit strategy key for investors | Westfair Communications

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Early stage investors know how they will make their money: through exits. Given the risks in this stage of investing, angels need to aim for a 30 times return on their investment. This means that a company needs to grow quickly and go through a liquidity event, generally a sale, before the investor sees any money at all.

 

Sourced through Scoop.it from: westfaironline.com

Professional investors understand the importance of planning their exit from the get-go. Sage advice for every business person! We hope you'll search our website for articles that help you build a custom exit solution. Or call us for a free consultation.

 

Engagement: Always on

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Employee engagement and retention today means understanding an empowered workforce’s desire for flexibility, creativity, and purpose. Under the evolving social contract between employer and employee, workers become “volunteers” to be reengaged and re-recruited each day.

 

Sourced through Scoop.it from: dupress.com

Very good article from Deloitte. Even small firms learn the hard way that employee engagement is central to building company value. Engaged employees become loyal, retained employees. For most firms, the gold standard in valuation is a low turnover workforce.

 

Planning Your Exit Strategy: Small Business Valuation | NFIB

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Eventually most small business owners will need to calculate the worth of their business - for the purpose of sale, loan application, estate planning, net worth calculation, etc. Also, valuation is critical when deciding to purchase a business.

There are numerous valuation techniques, ranging from simple "rule of thumb" methods to more complex ratios that include asset valuation and industry average valuations.

 

Sourced through Scoop.it from: www.nfib.com

This short article provides the basics, quickly. Valuation is complex and we've prepared an article to guide you: What's Your Company Worth?

 

Strategies: Entrepreneurs, what's your exit plan?

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When you’re about to launch your great start-up or build a small business, you don’t spend a lot of time pondering how you’ll eventually leave it. Sure, you might imagine your terrific new app will be bought for millions. Or perhaps you think one day you’ll make enough money to retire. But without a strategy, those dreams are just that — dreams. You need an “exit plan.”

Sourced through Scoop.it from: www.usatoday.com

Straightforward advice, straightforward article.

Finance Roundtable: Preparing Your Exit Strategy

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Cresa Atlanta and CPA firm Habif, Arogeti & Wynne (HA&W), LLP hosted a round table discussion of “exit strategies”—how business owners can prepare their businesses for eventual sale. Three noteoworthy speakers discussed when businesses should start thinking about their exit strategy, how to develop an exit strategy, and how to maximize exit value. Bishop Leatherbury of BDO served as moderator.

Sourced through Scoop.it from: blogs.cresa.com

Cresa Atlanta's round table delivers sage insight and advice from a group of professionals. Highly recommended article.

How to plan your business exit strategy | Money Marketing

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Stepping back from a firm you helped create, balancing competing interests and making sure you get the best deal are difficult decisions that need to be planned with great care.

Sourced through Scoop.it from: www.moneymarketing.co.uk

This short article from Great Britain helps ease anxiety. The key is to plan early. That's one of the most important things we do for clients at EGS.

6 Secrets of Employee Retention: Reward Them Now, Not Later

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The best way to promote a workforce that is both motivated and dedicated is to have a strategy in place that reinforces your top-performing employees’ commitment, dedication and loyalty. That’s why it’s important to make employee retention one of your ongoing goals.

Sourced through Scoop.it from: www.roberthalf.com

For many businesses, retention is a core value driver in a well-conceived exit strategy. This short article gets it right because it underscores that retention itself is a strategy, not a tactic.

Business Exit Strategy Thought to Ponder

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In this Thought to Ponder, we'll talk about the importance of having an exit strategy when running your business. And we'll address an important issue that few small business owners consider.

Sourced through Scoop.it from: www.youtube.com

Too many small businesses do exactly what this short video talks about. It has a negative impact on company value in buyer's minds. This is a heads-up on an important issue.

Exit Strategies for Family Business

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  • What will happen to the business when I decide to move on?
  • Should the business be sold?
  • Will my children want to carry on with the business, and, if so, is there a successor ready to assume the leadership and how will this be funded?
  • Would the current management team be interested in buying the business?
  • Should the business become a publicly listed company?
  • How do I help ensure the maximum return is received from the business?



Sourced through Scoop.it from: www.kpmgfamilybusiness.com

One really big missing question: how much time do I need in advance of an exit solution? (EGS says "begin with the end in mind.") Otherwise, this KPMG blog post asks the right questions.

Ready to retire from the company you built? Plan your…Exit strategy

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You did the research, wrote the business plan, obtained the funding, completed the paperwork, opened the doors and christened your business.

Sourced through Scoop.it from: www.biztimes.com

We like this case study. It reports on an ideal strategy, well-planned in advance. And it talks in detail about other scenarios, one or more of which will likely apply to your business. The article if full of sage advice.

Baby boomers, plan your business' exit strategy now - Baltimore Business Journal

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As recently as 2014, roughly 66 percent of all businesses were owned by baby boomers. Unfortunately, many baby boomer business owners don’t begin to think through their exit strategy until they are on the brink of retirement age, which puts them at a significant disadvantage.

Sourced through Scoop.it from: www.bizjournals.com

This short article is loaded with the most important advice of all: if you do not have an exit strategy, build one well in advance of the actual end game. EGS is ready to help.

How to Sell Your Business and Still Be in Charge

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Johnny Schillereff, founder of Element, explains why entrepreneurs who sell their companies but stay onboard need to be prepared for changes.

Sourced through Scoop.it from: www.inc.com

Only about a minute long, this video provides an early warning to business owners who plan to remain in a key position after the sale of the business. Here's the warning: get professional advice early.

Staff retention rates improve when employee efforts are recognised | Training Journal

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“Employee engagement incorporates many factors – and this audit clearly demonstrates that employee recognition is one of them. Employee engagement is about the emotional connection employees have with the organisation they work for.

Sourced through Scoop.it from: www.trainingjournal.com

Our colleagues in Great Britain are onto something here. Can simple expressions of gratitude instill loyalty, leading to retention which drives business value in an exit strategy?

Employee Retention: Is it all about the Money?

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Engaged employees are less likely to consider leaving. Gallup has found that 54% of actively disengaged employees would consider leaving for a raise of 20% or less.   In contrast, Fully engaged employees, those who feel involved in, enthusiastic and committed to their work, who would consider leaving for a raise of 20% or less falls to only 37%. Gallup’s findings indicate that the majority of actively disengaged workers will move-on for almost any raise, while the majority of engaged workers would need over a 20% raise to consider leaving. - See more at: http://www.34strong.com/teams/employee-retention-is-it-all-about-the-money/?__scoop_post=60ea3ec0-cb4e-11e5-c45d-001018304b75&__scoop_topic=4828031#__scoop_post=60ea3ec0-cb4e-11e5-c45d-001018304b75&__scoop_topic=4828031

Sourced through Scoop.it from: www.34strong.com

Employee retention looms large in exit solutions. Here's some late research that underscores the importance of keeping employees engaged and interested.

Insuring Your Business With a Buy/Sell Agreement

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How will the death of an owner affect a small business?


One way of safeguarding is to create a buy-sell agreement, a contract between different entities within a corporation to buy out the interests of a deceased or disabled member. A buy-sell agreement also can protect the business from loss of revenue and cover the expense of finding and training a replacement.


Sourced through Scoop.it from: www.chicagowealthmanagementgroup.com

Buy-sell agreements are prepared by lawyers. However, business owners need to consider many factors before preparing one. EGS is your guide and consultant for building a durable agreement.

Planning to sell your business? An FAQ

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15 FAQs people ask about planning to sell your business How far in advance should I start planning? When should I realise my investment in a business? Do I need to sell out if I want to retire? Will I have to retire when I realise my investment?

Sourced through Scoop.it from: lcf.co.uk

There's common sense and then there's legal sense. In this FAQ, a British law firm makes both common and legal sense, and much of it applies to American companies contemplating an exit solution.

Farm Family Business: 5 Top Tips for Your Exit Strategy

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The capital-intensive nature of agriculture, coupled with the unique income tax treatment of our industry requires both thoughtful and detailed technical planning as you ponder your next chapter.


Considering an exit from the farm or ranch can be just a little overwhelming. Not only do you have to think about who will take over and whether they are ready to do so, you have to analyze myriad financial and tax issues, assess your own mental readiness to let go, and perhaps even reach agreement with your significant other on what you will do with your “free” time. No wonder some people hang on too long!

Sourced through Scoop.it from: agfax.com

Ag business is no different from any other enterprise when it comes to exit solutions. We like the points in the article because they apply broadly to small and medium businesses.

Angela Ahrendts treats Apple Store employees like execs, retained 81% of workforce in 2015

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Apple Stores saw employee retention rates of 81 percent coming out of 2015, the highest ever recorded according to retail chief Angela Ahrendts, who attributes the statistic to a feeling of connectedness unique to Apple.

Sourced through Scoop.it from: appleinsider.com

Just amazing. Treat employees like the important people they really are, and retention soars.

Selling Your Business Internally: Ensure Your Legacy Continues

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Many business owners would prefer to see their business go to someone they know, such as key employees, partners, or family members in order to ensure that their legacy continues.


There are many benefits of selling your business internally that should not be overlooked:


  • Insiders already know the business, which means less disruption and a smoother transition.
  • Owners can negotiate a level of involvement that fits with their own personal goals.
  • Internal sales may be structured in a more tax-efficient manner that mini­mizes owner risk and keeps more of the proceeds in the seller’s pocket.
  • Loyal partners, employees, or family members are more likely to carry on the seller’s legacy than outside buyers would.

Sourced through Scoop.it from: www.businesstransitionacademy.com

BTA's article offers solid advice, invites you to a free seminar and offers a downloadable white paper.

Succession planning in family owned companies

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Succession planning in family owned companies is a long-term process that takes time. It is important to devise an exit strategy...

Sourced through Scoop.it from: www.3amalta.com

From the tiny Mediterranean nation of Malta (just south of Sicily) comes insight into exit solutions for family-owned small businesses. We like these insights.

Make Employee Engagement a Strategic Priority by Focusing on These 4 Things | The Disney Institute Blog

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At Disney Institute, we believe that by intentionally overmanaging – or paying extraordinary attention to – certain critical human resources processes, an organization can create and sustain a workplace culture comprised of highly engaged employees.


According to HR Magazine, employee engagement and retention will be the number one issue for most organizations in 2015. Here are the four interconnected processes that, when intentionally designed and nurtured, can help to create a “culture by design.”

Sourced through Scoop.it from: disneyinstitute.com

A quality article by a serious group. Worth the read.

4 Ways to Boost Employee Retention: An Infographic

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Look around your office and imagine that 3 of 10 people
you encounter each day will move on to another job this year.


If my math is correct, a 7,500-person company can expect to shell out over $22 million within the next 12 months to replace 30% of their non-managerial work force.


Sourced through Scoop.it from: youearnedit.com

A 7,500 person company is not a small or medium business. However, the rich infographic in this article applies to all but the smallest businesses.

5 Practices Every Small Business Owner Should Master

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As an incentive to subscribe, EndGame Success has prepared this action-oriented guide for business owners. EGS asks only for your first name and e-mail address in exchange for a link to download the guide, written by company founder and exit strategy coach Alan Mischler. Click here to get it.

Employee Recruitment Strategies: How to Attract (& Retain) Top Talent

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First of all, it's important to remember that many people prefer to work for small businesses. As long as you can demonstrate the other benefits of working for you, wooing them away from an opportunity with a larger corporation may not be as difficult as you think. Top talent, especially those who have worked for large companies in the past, appreciate small business culture.

Sourced through Scoop.it from: wordlink.com

Huffington Post article is spot on. A good read!

How to Prepare to Sell Your Business Simply in 2016

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72% of experienced business brokers recently interviewed stated that most business owners don’t allow enough time for an effective sale. As a result, the business ends up failing to sell, or selling for less than it could have because the sale was rushed.

Sourced through Scoop.it from: smallbusinessmarketinginc.com

EGS stresses the need to give yourself a substantial amount of time to prep your business for sale. Starting a new business? Create your exit strategy in the initial business plan...

A strategic exit plan starts now.

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Regardless of how, or to whom the business is transferred, proper steps need to be taken now, to ensure a successful transition when the time comes. A successful exit plan can take several years to implement, but with the necessary diligence, the resulting value of your business will be well worth the investment, for you, and the next owner.

Sourced through Scoop.it from: www.richter.ca

This Canadian firm offers straight advice. Emphasizing "proper steps," EGS is ready to help you figure out those steps with a refreshingly complete courtesy consultation.

Exit Strategies for Startups

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Venture-backed startups have two exit strategies: a buyout or an IPO.

Sourced through Scoop.it from: learn.onemonth.com

A minimalist informational article but has a couple of valuable points

3 Tips for Selling Your Small Business the Right Way - NerdWallet

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2. Seek out and rely on expert advice

Selling a business can involve complicated legal and financial issues, Wagner says. The smart move is to consult with experts to deal with those matters.


Sourced through Scoop.it from: www.nerdwallet.com

Point #2 is the key. But points 1 and 3 deserve your attention, too.

3 main valuation approaches when selling your business

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For those considering the sale of a business, it is critical to clearly understand the organization’s precise market value based on a complex set of factors.

Sourced through Scoop.it from: www.bizjournals.com

We disagree with the statement "An accurate valuation achieves several key goals: It maximizes profits and streamlines negotiations in the event of a sale".  In actual practice, a true valuation can differ from an owner's perceived value.  A true and accurate valuation might reduce profits depending upon market, ownership structure etc.  Still, a valuation is a “must” step in preparing a company for sale.

Interview Process Vital for Employee Retention

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Employee retention starts before you even make a job offer. Check your interview process to make sure you aren't making these common interview mistakes!

Sourced through Scoop.it from: www.talentculture.com

Useful tips that can be applied to developing a company culture that supports an exit strategy

How to Choose an Exit Strategy

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"Most entrepreneurs over time should start to think about a future exit strategy because preparing for an exit takes some time," says C.J. Fitzgerald, managing director of Summit Partners, a growth equity firm with offices in Boston, Palo Alto, and London.

Sourced through Scoop.it from: www.inc.com

Although directed at sizeable and publically-held firms, this advice applies to the SMB. The article emphasizes the need to start early. Exits are not like after-dinner mints. Good exits need ample time.

Deciding to Sell Your Business? Take These 4 Steps

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There are four stages of the exit process that all business owners must take in order to ensure their transition is successful.

Sourced through Scoop.it from: www.nuwireinvestor.com

Nice concise overview of the pre-sale decision process

Your company’s value may exceed expectations

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Business owners at some point (or at several points over the lifetime of the firm) ask what the company is worth. Answering this question is highly problematic. When business owners have their end game in mind, high up in the tactics of any exit strategy will be a solid estimation of value.

Sourced through Scoop.it from: endgame-success.com

Many owners stay too close to the forest to see the actual value trees of the business. Years before any planned exit strategy implementation, steps should be taken to maximize the value. Alan Mischler's guidance is welcomed.

Five questions to ask before you sell your business

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When investment guru Warren Buffet was asked how to build a great business, he answered: “Surround yourself with great people.” And it’s also the best advice for the entrepreneur starting to think about the trickiest journey of all – how to sell the business.

Sourced through Scoop.it from: www.theglobeandmail.com

These five questions dress up or down depending on the market space. But they are strong questions for any business owner contemplating an end game.

3 tips to help veteran small business owners with succession planning

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Winding down a business is a crucial stage of the business life cycle. As you think about the future of your business — whether you want to sell, transfer ownership, cash out or wind down entirely and seek retirement, it’s helpful to start a business exit planning process. There is no “one plan fits all” solution when it comes to developing a succession plan for your business, but here are a few tips to consider:

Sourced through Scoop.it from: www.miamiherald.com

Several strong points from this Miami consultant

Key strategies for speeding up the sale of your business

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Of the many questions I get asked about the process of selling a business, I always joke that this is the one question I can’t answer: How long will it take to sell my business? There are just too many factors that come into play.

Sourced through Scoop.it from: www.bizjournals.com

EGS thinks that your best strategies require analysis of the business by experts like the ones at EGS.

20 Years, 20 Tips for Building a Healthy Business - Entrepreneur

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17. Plan for an exit.

At some point, plan for an exit strategy. While you may never execute that exact exit strategy, it’s important to have one in place. You never know what the future holds. Plan for a day when you may need to leave your business or hand it off to someone else. Design your business so that it can run in your absence; otherwise, it will hold little value to a potential buyer.

Sourced through Scoop.it from: www.entrepreneur.com

This is a charming, candid look at a small business that suprised many to grow into a medium business with many employees. We think point 17, above, should be in the top five. Read 'em all...

So You Want To Sell Your Business… Part 1 of 4 – Purpose of the Sale

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Sourced through Scoop.it from: www.jdsupra.com

We hope the next three parts are as succinct and clear as this first part.

Six factors to think about when choosing a business broker

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While you may be tempted to sell your business on your own, hiring a proven business broker can simplify the process and earn you a higher sale price.

But how do you hire the right broker?

Sourced through Scoop.it from: www.bizjournals.com

Built to Sell: Creating a Business That Can Thrive Without You

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Built to Sell: Creating a Business That Can Thrive Without You - Kindle edition by John Warrillow, Bo Burlingham. Download it once and read it on your Kindle device, PC, phones or tablets. 

Sourced through Scoop.it from: www.amazon.com

Highly recommended. This well-written book covers the key issues.

Know When and How to Sell Your Business

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Experts say selling a business takes just as much thought and effort as starting it.

Sourced through Scoop.it from: www.entrepreneur.com

Good article offers valuable advice. Makes an interesting contrasting comment to other articles about not starting a company with the end in mind (sale), recommending that solving a problem is a better startup reason. The most valuable piece of advice: "Don't Ever Go It Alone"

Startup Exit Strategy Planning: 10 Surprises Buyers Don't Like to See

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Potential buyers don’t want to discover anything new that wasn’t previously disclosed, anything that raises any questions, anything at all unexpected. Surprises can cause your potential buyer to reduce their original offer…or even walk away.


Sourced through Scoop.it from: earlygrowthfinancialservices.com

These 10 surprises are valid... and avoidable when you gain the benefit of professional insight as early as possible. When is the best time to plan your end game? When you start the business!

3 Questions You Should Ask Before You Sell Your Business - Huffington Post

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Building up a business is a valuable life experience, and selling it is just as exciting. Obviously there is the financial gain, but you can also point to it and say "I made that." But before you put up the virtual "for sale" sign, stop and ask yourself three questions: "What's next?", "How much will I pay in taxes?", and "Can I add significant value by waiting?"

Sourced through Scoop.it from: www.huffingtonpost.com

Retaining Talented Employees via an Integrated Competency Framework - TalentGuard

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Employee retention is one of the largest problems facing companies today. Every organization has its own way of handling the issue, from competitive compensation packages and flexible schedules to interior promotions and regular evaluations. Goals like improved retention, however, are always easiest to meet once they are clearly stated. What does “improved” employee retention look like?

Sourced through Scoop.it from: www.talentguard.com

Selling your business or not, retention is a key driver of business value.

Want To Sell Your Small Business? How You Define Small Means A Lot

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The fact is that the term “small business” has become meaningless. The media and politicians use it to describe pretty much any business that is not trading on the New York stock exchange. If it is smaller than Exxon then they call it “small business”.


A 1-20 business is one that does $1 million or less in sales, has 20 or fewer full time employees and is owner-operated. Selling your 1-20 has a different rule book and you are best served by consulting a professional.

Sourced through Scoop.it from: www.thebizseller.com

Selling your business doesn't have to be one of the toughest things you ever do. Like preventative medicine, you can prevent a host of difficulties with advanced professional planning.

Three Ideas to Boost Employee Retention

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Companies that take the problem seriously and implement programs to ensure employee satisfaction have the highest retention rates. “Show me the money” is not the singular solution. While bonuses, stock-options, and flextime are appreciated, what employees really want is some assurance of continued employability. Here are the most popular worker retention strategies:

Sourced through Scoop.it from: switchandshift.com

Even the smallest company will benefit from studies that reveal the most important retention tools. And it's not money.

Use flexible working to improve employee retention and attraction - HR Grapevine

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The option to work remotely is a huge factor in employee attraction and retention, yet many are failing to keep staff informed of their options. “There has been a huge cultural shift in the workplace over recent years, which we believe will only continue to grow. As a conference calling service provider, we have seen first-hand how technology has revolutionised the way we do business. These innovations in technology will only continue, facilitating and streamlining the way employees stay connected to their business from any place, at any time.”

Sourced through Scoop.it from: www.hrgrapevine.com

This report from the U.K. is universal. A key measure of business value is employee retention, and remote work policies definitely improve retention.

Why You Need Key Man Insurance

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How do you determine who needs this insurance? Look at your business and think about who is irreplaceable in the short term. In many small businesses it is the founder who holds the company together--he may keep the books, manage the employees, handle the key customers and so on. If that person is gone, the business pretty much stops.

Sourced through Scoop.it from: www.entrepreneur.com

The role of key man insurance can be simple or complex in any end game strategy. You'll want to acquire guidance from professionals who have walked the walk many times. Then you'll be able to make a bespoke decision about the value of key man insurance.