It is necessary for every business owner to have a well-planned exit strategy ready given an emergency exit from the business.
Some people would say, planning exit strategy can just be critical as beginning the company. A well-organized exit strategy will utilize the present state of any business when you decide to sell. It will further considerably decrease the time required for the necessary preparation to dispose of the company.
“You cannot overvalue the necessary to plan and equip. In most celebrated of the errors people ever make, there has occurred this popular theme of poor planning before.
Even though everything may be running fine in the business, you never know when you need to sell your business and move on.
This is where your business strategy comes in.
What is Exit strategies: should you have one if you’ve started a business?
Your exit strategy is your unique plan of how and when you will leave your business. When you’ll sell your company? Or Who you’ll sell it to? And whether or not you’ll still be a part of the business as it moves forward.
An exit strategy for business is a work in process. A well-organized exit strategy holds the command in your hands, and you can maximize the benefits from the sale of your business.
Whether it’s a detailed plan or a summary overview, it is a good idea to have a strategy for exiting your business.
Why? For three key reasons.
Firstly, it gives you a roadmap. How are you going to get there if you don’t know where ‘there’ is? It doesn’t need to be too detailed, but a rough idea can be constructed so you can head in the right direction.
Secondly, your exit strategy can be a compelling motivator to keep going. The daily problems of running a small business are put into perspective when there is an end goal in sight. For me this is a key one because, as the head of your business, your team will look to you to lead them, having this motivating factor can help you inspire the people that are around you.
And the third reason? Money. An exit strategy will make sure you get the best possible price for your company. Being aware of the prospect of selling your business allows you to focus on the activity that will achieve the most significant value at the point you intend to sell.
Adapting your exit strategy
Of course, like all best-laid plans, you may not exit from your business exactly as you thought you would.
The exit plan should be well documented and reviewed every year. It does not need to be the size of war and peace keep the program short and precise. You should discuss your exit plan with your loved ones, professional advisors and critical confidants. A trusted family member or friend should know the location of the exit plan.
You can always take advantage of new opportunities when they come along. Continuous planning will give you something to work towards, exiting your business how and when the time is right for you.