Business Continuity: Graham Lawes
Here I have answered some of the most common questions asked by company directors looking to plan for their future.
1. What is the biggest challenge facing business owners when they want to exit?
The number one obstacle is owner dependency. If the business can’t operate and grow without the founder, investors see risk – and risk lowers valuation. Unlock maximum value by building a capable, committed leadership team and ensuring those leaders are recognised as the face of the business
2. What are the key things investors look for when considering an acquisition?
- Growth potential. Well-defined opportunities for expansion with a clear ROI case.
- Scalability. The ability to increase revenue without a matching rise in costs.
- Profitability and cash flow. Strong, sustainable earnings are non-negotiable.
- Management strength. A proven leadership team that can deliver results.
- Processes, governance and compliance. Documented systems, robust governance and alignment with relevant environmental, regulatory and social trends.
While some investors specialise in distressed assets, the most sought-after deals combine high growth potential, healthy profits and leadership resilience.
3. How can a business owner strengthen their position in preparation for a divestment?
Start by making yourself non-essential. Build and empower a management team capable of running the business independently. Maintain timely, accurate financial reporting and focus relentlessly on EBITDA, revenue growth and cash flow. Instil a culture of continuous improvement, optimising processes so the business is not just profitable but operationally lean.
4. What are the divestment options available for SME owner-managed businesses?
- Trade sale. Selling to a strategic buyer in the same or adjacent sector.
- Private equity investment. Typically for larger SMEs.
- Management Buy-Out. Requires strong profitability and cash flow to service debt.
- Employee Ownership Trust. Often appealing for cultural or legacy reasons.
Each path has nuances, but all require the same foundation: leadership depth, scalable growth and financial health.
5. What is your number one piece of advice for business owners with respect to exit?
Start early. A successful exit is not an event but a multi-year process. Early preparation gives you the time to strengthen the team, enhance value drivers and position to achieve the best possible return.
6. What resources are available to support business owners through a successful business sale?
Most owners start with their accountant or solicitor. These professionals are essential during the sale process, but many accountants lack a corporate finance focus. For strategic ‘how-to’ guidance – building value, preparing the organisation and structuring the deal – engage a business adviser with direct acquisition and divestment experience. The right adviser combines financial insight with operational expertise to align the business for maximum sale value.
