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As the year comes to a close, many business owners are reflecting on what has been a challenging period. Between economic uncertainties and interest rates only recently declining, it’s no surprise that some might consider pausing plans for succession until early next year. However, delaying your exit strategy could mean missing out on a prime opportunity to engage with motivated buyers during this pivotal season.

 Why the Holiday Season Matters

 The holiday period is a time of reflection and reassessment for many professionals. It’s when people take stock of their careers and consider significant life changes, such as stepping into business ownership. For those contemplating a business exit, now is the time to act - not wait until February or March.

At Platform 1 with our Transitional Exit Strategy, we’ve observed a surge in engagement. Open rates on our communications with potential buyers have been higher. The interest and talent pool is out there, and the competition among buyers is growing, especially for high-quality, profitable businesses generating $3M to $30M annually.

What’s Driving the Demand?

Shortage of Quality Businesses
Buyers consistently express frustration at the limited availability of profitable, well-established businesses. This gap presents a significant opportunity for business owners ready to step back or transition gradually.

Aging Population Impact
With an aging population, the talent pool of potential business partners or buyers is not growing as fast as the demand. Those who are ready to take over are actively seeking opportunities now.

The Preference for Gradual Transition Exit Strategies

Many interested people prefer a staged approach to acquisition rather than an outright purchase. This allows them to acquire shares gradually, benefit from the existing owner’s expertise, and ensure a smoother transition of knowledge and intellectual property.

The Case for Acting Now

Delaying your exit could mean missing the “Christmas crowd” of buyers who are ready to get into a business now. Based on our experience, we anticipate a significant uptick in exit activity in Q1 2025.  Waiting too long could result in a crowded market where your business competes with many others, reducing your leverage.

By partnering with Platform 1, you can connect with a pool of capable Business Partners who:

Have the capital to invest.

Possess the skills to grow your business.

Prefer a collaborative transition with the current owner still involved.

Why People Prefer the Staged Exit Approach

A gradual transition offers benefits for both sides: 

Easier Financing: Buyers can acquire shares over time, reducing the immediate financial burden.

Knowledge Transfer: Sellers remain involved, ensuring critical business knowledge is passed on.

Lower Risk: Both parties have time to build trust and confidence in the process.

Don’t Wait Until It’s Too Late

For baby boomer business owners contemplating succession, now is the time to act. The demand for quality businesses is high, but the pool of qualified potential  business partners is finite. Waiting too long could mean missing your ideal window to secure a smooth, profitable exit.

The time to plan is now. Engage with the talent pool, explore a staged transition, and set your business up for a seamless handover.

About the Author

Mike Warmington is a Director of Platform 1 NZ Ltd - The New Zealand market leaders in business owner transition. Platform 1 specialises in using executive search techniques to find business partners with capability and capital for business owners wanting to partially or fully transition out of their business.  

 www.platform1.co.nz