Here's what we do. We sit down with the business owner and we say, okay, there's short-term and long-term. So there's contingency planning and then there's long-term strategic planning.

So the first thing we do is we sit down with them and we say, let's play a game. Let's pretend that you have to step out of the business for six months, okay? And we can use whatever you want. You go on vacation for six months or God forbid, a family member gets sick and you gotta take care of them for six months.

How does the business run during that six month period? And we brainstorm solutions to that. Well, those solutions end up becoming exit plan options, right? So if you've got a good number two, if your business is a good size, you may have a chief operating officer, you may have somebody who heads up your sales and marketing, you may have somebody else who is your accounting person, you may call them a bookkeeper, a controller, or if you're bigger, a CFO, right? And if you say to me, these three people, they can put their heads together, they can run the business for six months, I would say, okay, then you got a contingency plan in place. We need to document that so that everybody knows what they need to do if you're out of the business for six months.

Now, then we take that and we can transition that into one exit strategy and that may look like, we could call it a sale to the employees, bigger companies call it an ESOP, an exit stock option program, right? So you need to have an employee sale option. You can also have, if you're a bigger company, a management sale option. So you could have managers that could lead the company, borrow money from a bank to buy your business, or you could have the employees own shares in your business and buy the business.

So those are two options we look at with the business owner on a contingency basis that we can transition into a full-blown exit strategy at some point. The other options for an exit could be something like a sale like you mentioned, there's a strategic sale, there's a sale to potentially a competitor, right? So if you're a number one, you may wanna sell your business to the competitor who's number two. If you're number two, you might wanna sell to number one or to anybody else along the chain or somebody who's in a complimentary industry who wants to enter your industry, you could sell to them.

So those are strategic sales. There's a sale to private equity. So there are some industries like managed services, technology, private equity is all over them like stink on a pig.

Also home services businesses these days, roofers, garage door businesses, anybody who does heating, ventilation, air conditioning, private equity loves to buy those. So there's an opportunity for you to potentially sell it to private equity. If you get really, really big, talking over 100 million, 200 million in annual revenue, and you've got a really good attorney, maybe you could go public.

I mean, back when you and I were coming up in the 90s, everybody wanted to go public with their business, right? I mean, that's a long shot option, but there's a whole spectrum of options in addition to exactly what you said. So you got a good team, but your team doesn't wanna buy the business, but you can take extended periods of time off from the business. God bless, go to Europe.

Let the team run, give them an incentive, give them a profit sharing incentive. Let the business keep running. You do your thing, check in from time to time.

If they don't wanna buy the business, let it run without you. You got Fredo, who's your son. You just make sure the business is bulletproof so that Fredo, even though he's weak and stupid, doesn't run the business into the ground.

You develop standard operating procedures, put a good team around him. You can pass it on to Fredo. The one option you don't want, Tom, you don't wanna die at your desk, right? So you have to have other options in place because dying at your desk is the worst possible option.

Now, all of these options require that you have a business that's saleable, right? So your business has to make profit. Somebody else has to be able to repeat the profitability of your business so it can't be dependent upon you, right? And there has to be, this has to be something that is desirable. So you have to produce something or have a business that somebody will want, right? So the business has to make a profit.

It has to be able to run without you. And the productivity has to be desirable for somebody else. If you got those three things, you got a saleable business, all of those options are on the table for you.

The ones to start with are what happens if I have to take an unplanned vacation from my business for six months, right? It's so spot on and so helpful to me even. But as you're talking, something occurred to me. A lot of times, a mom and pop, small little local business comes to me and says, I got this great concept and I wanna franchise it.

The advice is almost exactly what you're saying. Like you gotta set it up. So if you're not there, what happens? And so what I advise people to do is go open up a second location without you being there.

Let your brother-in-law run it, let your neighbor run it and figure out where the blind spots are. And that's how you can figure out how you're gonna franchise this thing because you might be in Florida, but your first franchise might be in North Carolina. How are you gonna deal with that person when you could just talk to them on the phone? So there's something there.

It's like instead of exiting, you could franchise your business or something like that. So the best thing, what you're talking about, the best thing to do is to get somebody with a lot of common sense. You don't need a genius.

You need somebody with a lot of common sense and somebody from outside of your industry, right? So you got a great restaurant and it's profitable. You got a great concept. Restaurant business is notoriously hard.

You wanna franchise your restaurant. So you're gonna open up another one on the other side of town. Find a smart person, a common sense, street smart person.

They don't have to be book smart. Common sense, street smart person. Write down all of your processes and procedures.

Have all the standard operating procedures together. Get the best cook from your restaurant and the best server from your restaurant. Put the best cook and the best server over in the other restaurant with the smart, common sense person who spent a month in your shop learning what you do.

Give them the processes and procedures and you check in every day, once a day, and then once a week, and then a couple of times a month, and see if they can do it. If that street smart, common sense person with your best cook and your best server can get that business going and run that business, you know you got something you can franchise. Yeah.

Well said. That is brilliant. And it's interesting because it reminds me of like when I had a job, you know, 30 something years ago, before there was emails and cell phones and all that kind of stuff, I would go, you know, I'm going on vacation for a week, so I have to write down to my, you know, partner who's gonna take over my business.

So this is what you do first. You come in and like really detailed, you know, you're gonna check the mailbox with no email, but you're gonna check the mailbox, then you're gonna go do this and, you know, and so it's like that. It's like getting ready to go on vacation.

And one of my favorite lines I heard a couple of years back is imagine if we acted every day the way we act the day before vacation. Your most productive day of the year, the day before vacation, right? So I'll tell, here's what I do, and this is, I mean, I grew up in the Marriott organization. My first job out of college was, I started working in the dishroom, and then I was a bellman, and I worked all the jobs that you can possibly work in a hotel.

So I'm a big believer in standard operating procedures. So now my wife and I both travel for work occasionally. So about three months ago, we were both away at the same time, and the kids had to take care of our two dogs.

And our two dogs are, you know, they're four years old, so they're not puppies, and they're very calm, relaxed dogs, but they have a special diet. They eat something different for breakfast than they eat for dinner. So I'm the guy who takes care of the dogs.

I'm the dog guy, nobody else. I feed the dogs, I walk the dogs, I talk to the dogs. Like the dogs, the dogs and me, we have a special bond.

So I shoot a video for my kids of exactly what to do to feed the dogs. Like this is breakfast, I take the can off the shelf, I put the kibble, the can, I mix it together, and I say Enzo gets this much, Andy gets this much, and I show him with the bowl. Then I wrote everything down, and I taped it to the wall with an arrow pointing at the cans.

Like I thought to myself, what can I do so that if I was half asleep, and I just stumbled into this house, and I said, oh, there were dogs here, they look like they need to be fed, what am I supposed to do? I want this to be so bulletproof that anybody who stumbles into my house half asleep could do it. And that's what it took for me to feel good about making sure, like the dogs are living things, right? I wanted to make sure the dogs were still alive when I came back in five days. So like that's the kind of level of detail.

You're never gonna go wrong in your business with that level of detail. Worst case, your employees are gonna look at you like my kids looked at me when I came back, and they were just like, really, really? We needed the video, and the thing on the wall, and the instructions, like really? Like the dogs could have read this and fed themselves. That's better than having them give the dog that's allergic to three different types of foods, a type of food that he's allergic to, and have a $5,000 vet bill when they take him to the vet, right? So you can never go wrong with too much detail or too much training in your business.

That is an investment that is always going to pay off for you.