to help — be that an accountant, attorney, financial planner or investment counselor. The next step? Finding out how much you can get for your business. “A business valuation is an estimate of the dollar value of a given business owner- ship interest at a specific time,” Friedman explained. “But, what is value? Value can mean different things. It depends if I want to sell the business and retire, if my partner wants out or my employee wants in. We focus the most on fair market value — the price at which your store changes hands when a willing buyer and willing seller are not under any compulsion to buy or sell.” When addressing how to add value, Friedman and Jobe advised owners to not increase sales at the expense of gross profit. “Don’t increase profitable activity at the expense of cash flow,” Friedman said. “One word to remember would be ‘prof- itability.’ People think it’s all about cash flow, which is important, but profitability is more important.” Some “inside baseball” for retailers look- ing to retire soon? “We are seeing a resurgence of people in their late 20s and early 30s looking to buy a music store,” Jobe said. MI
Make a Succession Plan — Now Keys for business owners looking to plan their own exit. A ddressing a topic that is front-of- mind for many in the school music business, MI industry CPAs Alan opened the session on a sobering note: “The time to start planning your succession is the day you open your doors.” Friedman Kannenberg’s Daniel Jobe and Alan Friedman.
Freidman and Daniel Jobe of Friedman Kannenberg presented “Succession Basics: How to Cash Out on a High Note” on Friday morning. Speaking to a packed crowded, Friedman
While many business owners procrasti- nate developing succession plans, Friedman said the best way to “cash out on a high note” is starting early by evaluating an asset versus stock sale and finding a professional
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