All good things must come to an end, and there will come a time in your life when you’re ready to either start playing a smaller part in the running of your business or say goodbye to it forever.
Having a well thought out exit strategy already in place will help you to sell or otherwise dispose of your business quickly, profitably, and with minimal stress and hassle.
What is an exit strategy?
An exit strategy is a plan for selling your business in order to maximise profit and the business’ chance of success once your involvement has ended.
Some common types of exit strategy include:
- Sell to an outsider
- Sell to investors
- Sell to family
- Initial public offering (IPO)
When planning and preparing your exit strategy you should aim to get your business to a point where all business information and accounts are up-to-date, and all business processes are documented. This will allow you to hand over ownership to someone else swiftly should you be unexpectedly required to do so.
The type of exit strategy you choose may depend on several factors including:
- Whether you want any continued involvement in the business.
- Your business type and size.
- How successful your business is.
- How quickly you wish to exit.
- How important it is to you that your business continues in the same way.
Why is it important to have an exit strategy?
A well thought out exit strategy can help you to get more from your business when you eventually decide to part ways with it. Even if the business has not been successful, an exit strategy will be beneficial as it can help you to minimise losses.
You never know what could be around the corner and having an exit strategy in place will allow you to sell your business quickly, efficiently, and with minimal stress in the event of the unexpected.
Some reasons you may require an exit strategy in place and ready to implement include:
- Business isn’t doing very well.
- A new opportunity comes along.
- A change in your personal life.
It is wise to seek professional and objective help with planning your exit strategy to ensure that your valuation is realistic, and your plan is as profitable as it can be.
Preparing your accounts
You will need to make sure that all your business’ financial records, accounts, and bookkeeping are up-to-date and organised before seeking a buyer for your business.
For help or advice with planning your exit strategy or preparing your business accounts for selling your business, get in touch with our team of experts here a Michael Bell by calling us on 01484 690730.