A well thought-out succession plan can help you make a graceful exit from the business.

A smooth succession is “not something that generally happens overnight,” says Sandra Foster, president of Headspring Consulting Inc. in Toronto. “People’s lives are involved, there’s a lot of money at stake and it can take a long time to find the right buyer.”

Once you decide it’s time to sell your practice, follow these tips to set the wheels in motion:

> Check with your firm
Before you decide to sell, Foster says, make sure you understand your relationship with your employer or dealer and whether the firm imposes any constraints on the selling of a book of business.

For example, you may not own your client accounts, she says, and therefore may not be at liberty to sell the book. (Your firm may provide succession-planning advice or support.)

> Make a comparison
Find out what else is out there — other books of financial advisory business for sale— so you can best position your business to potential buyers.

Talk with other advisors and industry members to find out how your business compares to other practices, Foster says, and how other books have been sold recently. That way, you’ll be in a better position to know when an appropriate buyer or offer comes along, and how to respond.

> Think like a buyer
Have a plan ready when you decide it’s time to exit the business.

You won’t get top dollar for your business, says April-Lynn Levitt, a coach with the Personal Coach in Calgary, if you don’t do a little work to prepare it for sale.

Take a look at your business from the point of view of a buyer, Levitt says. Ask yourself:
Would I want to buy this practice?
Does it have systems already in place?
Are the files organized and compliant?
Is it a good revenue-generating business?

> Have a plan
You have probably told your clients that a successful retirement is about more than finances. Similarly, your transition will require personal preparation and adjustment.

Says Levitt: “It can be really hard if you’ve gone from owning a business and working all the time to suddenly just stop.”

You need a vision for what’s going to happen next.

Think about what your retirement will look like, Levitt says. For example, are you going to sell your business and never look back? Or, will you make an arrangement with your successor to work part-time?

This is the first in a two-part series on selling a book of business. Next: Preparing your team.