Business transitions amid a silver tsunami'.

Byline: BridgeTower Media Newswires

The statistics are clear: The age landscape is changing and will continue to change in the next decade. No area is immune to this impending "silver tsunami."

Approximately 10,000 baby boomers turn 65 in the United States each day.

The Exit Planning Institute anticipates that over the next decade companies representing over $10 trillion in wealth will attempt to transition ownership.

What does this mean for businesses? Without a plan in place for a transition of ownership, a business owner may run the risk of missing an opportunity to monetize his/her business assets, preserve a legacy or, worse, be faced with a decision to close the company's doors.

While business owners face a personal and fact-specific decision to transition their business, the following options are generally available:

Identify an heir apparent and develop a plan NOW

Does the business have a key person in charge of operations or some other important business function? How involved does the selling owner want to be in the short- and medium-term? Does the business own the building in a separate legal entity owned by the business owner? The answers to these questions (and many others) should be memorialized and thought out in a transition plan.

As early as feasible, begin to prepare a plan with that individual (or group of individuals) to transition ownership. This option can help to reduce disruption from an employee's perspective and may provide an owner a multi-year transition period to extract himself/herself from the business. This can also strike a balance between the owner's ultimate after-tax buyout value and continuity of operations.

A plan should include operational functions (such as a new organizational chart/job descriptions) and financial components (potentially funding a buyout, agreeing on the selling owner's employment terms, how to treat the building that the business operates in, etc.).

Prepare and market the business for third-party sale

When the process is managed properly, this option generally will maximize the owner's sale price of the business. If a transaction is large enough, it is prudent to include an investment bank to broker the deal. However, this option may potentially sacrifice continuity of ownership and ongoing operation. Preparing a business for sale can range in duration and complexity depending on the size of the business and the desires of the buyer.

For example, with a strategic acquisition or...