Many music retailers tell me they have a buy-sell agreement. That is they have a good idea of who they want to eventually sell their business to. Fewer have the agreement in writing, and even fewer have it correctly funded.
Having a written buy-sell agreement in place is at the heart of a SUCCESSFUL business transition plan. However, if that agreement is NOT funded, business owners can be left in a vulnerable position in the event of unplanned events such as : Divorce, Death, Disability, Disagreement, Departure.
Typical funding sources include: Cash- Borrow-Savings-Installment Sale-and Insurance.
Below, you’ll find a quick summary. Let me know if you have any questions.
Source: The Principal Financial Group