Right now most of us are worrying about, well Right Now!! The market, money, staying afloat. But have you thought about how and when you will leave your business? Your retirement?
I have a girlfriend that says she will never retire, wont be able to, they will carry her out on a stretcher while she is showing a house!! We laugh, but I wonder how much truth there is to that statement. Probably more than most of us realize. We all know we need to save money in our retirement 401K, SEP IRA, whatever you are set up in.
Where I am going with this is; Selling Your business to another Business person when you are ready to slow down or retire. We must think of ourselves as a business that will be sold when it is time to go,unless you are handing it down to your children or family members?
In the past I have seen agents "sell" their business/ database to another agent. One example was that One agent gave the retiring agent a large lump sum to "buy their SOI" with the promise of the retiring agent sending out postcards from time to time reminding the SOI to stay in touch, that the new agent was taking over. The new agent would then incorporate the new SOI into their marketing plan. There were also referral fees negotiated. I don't know the exact specifics of the deals.
What I found interesting about this transaction, from an outsiders perspective was that the retiring agent "sold" the business to the highest bidder, not necessarily the best match as far as personality goes. What I mean by this is while, the agent who bought this business is one of the best agents I know, he is very business like and bottom-line oriented. Very successful person, nothing wrong with that. The agent who retired was a hand-holding, motherly type agent. I believe in that we attract people that are similar to us? Like begets like? So, I don't think it was a good deal for the agent that bought the business because I don't think the SOI felt comfortable with the second agent? I know that some of the SOI did business with a different agent from another company, but her style was more like the retiring agent, hand holding - motherly.
My point is if you think it is a really good idea to buy a successful persons business, make sure your business, personality model is similar so you can reap the benefits of this situation. If you are the retiring agent, be conscious of your SOI, will this agent be a good fit for them. You will benefit in the long run because you will have more referrals.
The second example was that the retiring agent "referred" the clients from her SOI to a handful of agents and who she thought would "fit the mold" based on personalities. I think the second agent had more success in her retirement.
What is important about this is Know that your SOI is a gold mine. If you don't have an SOI, get one, nurture it and make it grow because it can be a big part of your retirement plan.
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Audrey, You make a great point, and one that is often overlooked. I have a client who plans to retire within 3 years, and she is putting a lot of energy into getting her business in the best shape possible.