Starting a small business is tough. But have you thought about what happens when you want to retire? It turns out, figuring out how to step away can be even more challenging. Mike Roach, who co-founded Paloma Clothing in Portland, Oregon, in 1975, realized he needed a plan after nearly 50 years. His manager, Traci Burnes, played a crucial role in navigating the pandemic and keeping the business afloat. This got Roach thinking: maybe she should be a co-owner.

About half of all small business owners are over 55, according to the U. S. Census. Most people retire in their 60s, so many owners are nearing that stage. There are a few common ways to exit a business: handing it over to a family member or an insider, selling it to an outsider, or simply closing shop.

Taylor Trapani took over her mother's business, Trapani Communications in Midland, Michigan, this year. They started planning the transition five years ago. “It's like buying a house, ” she said. “Lots of paperwork and meetings with attorneys. ” It's essential to get your business ready early, so you don't lose value at the last minute.

Be open with employees and clients about the change. Roach emphasized, “Plan early and have a clear strategy. ”

Planning for a Small Business Exit: A Casual Guide

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