Exit Planning FAQs for Business Owners in Bend, Oregon
1. What exactly is “exit planning,” and why do I need it?
Exit planning is a structured process that helps a business owner prepare to transition out of their company—whether by selling, transferring to family, or closing. It ensures you maximize business value, minimize taxes, and achieve your personal and financial goals. For many Bend-area owners, their business is their largest asset, so planning the exit is essential for protecting that wealth.
2. When should I start planning my exit?
Ideally, you should start 3–5 years before you intend to exit. This allows time to increase business value, strengthen management, clean up financials, and explore tax-efficient strategies. Even if you’re not planning to sell soon, an exit-ready business is usually a stronger and more profitable one.
3. What are my main exit options as a small business owner?
Your options generally include:
Third-party sale to an outside buyer or private equity group
Management buyout (MBO) by key employees
Family succession (transfer to children or relatives)
Merging with another company
ESOP (Employee Stock Ownership Plan) for larger firms
The right path depends on your goals, business structure, and timeline.
4. How do I know what my business is worth?
A professional business valuation is the first step. In Bend’s market—where industries like construction, outdoor recreation, hospitality, and professional services are strong—multiples can vary widely. A certified valuation expert helps determine a fair market value and identify ways to enhance it before the exit.
5. What tax implications should I be aware of when selling my business?
The structure of your sale (asset vs. stock sale), the type of entity (LLC, S-Corp, C-Corp), and how proceeds are allocated all affect your tax outcome. Oregon’s state tax rates also play a role. Working with a CPA experienced in exit planning can help you minimize capital gains and other taxes.
6. How do I make my business more attractive to buyers?
Consistent cash flow and clean financial records
Strong management teams (not overly dependent on you)
Diversified customer base
Documented processes and systems
A solid local reputation and growth potential
Investing in these areas well before you sell can significantly increase your sale price.
7. What role does my personal financial planning play in an exit?
A successful exit isn’t just about selling your business—it’s about ensuring you can live comfortably post-sale. Your exit planner and financial advisor should help you align business value with your retirement goals, investment strategies, and estate planning needs.
8. How can I transition ownership to my children or key employees?
You can transfer ownership gradually through gifting, installment sales, or share transfers. In family or employee successions, it’s important to balance fairness, control, and tax efficiency—and to formalize everything in writing to prevent future disputes.
9. What if I’m not ready to retire but want to reduce my involvement?
You can phase your exit by delegating day-to-day operations, hiring a general manager, or selling a partial stake. This strategy is common among Bend-area business owners who want to enjoy Oregon’s outdoor lifestyle while still maintaining income and ownership.
10. How can I start the exit planning process?
Begin by scheduling a readiness assessment. An exit planner will review your business value, personal goals, timeline, and financial position. From there, you’ll receive a roadmap covering valuation, tax planning, deal structure, and succession options.
