Starting and running your own business involves a lot of blood, sweat and tears. Developing strategies and plans to grow your business are essential to its success and need to be re-evaluated as the business continues to grow or change. Whilst you may be years off retirement, what happens when the time comes to leave it all behind?
Experts say that no business planning process is truly complete without considering how you intend to exit the business. It can help you realise the value you’ve built up in your business and the equity in your company. Having an exit strategy worked-out in advance can give you control over your small business‘ future, as well as give you peace of mind that you will be compensated for all the time and effort you have put in your business.
Possible exit strategies include:
Keep your business in the family
Keeping your business in the family makes certain that your legacy lives on. This exit strategy gives you the opportunity to have a continual say in the business and the ability to train your successor. However, this strategy may not be an option for many business owners.
Sell the business in the open market
Selling the business is the most common exit strategy. Provided you have a plan and realistic expectations, by selling your business you may end up with a healthy profit. Value your company to be sure that you are not underselling your business you have worked so hard to build.
Liquidation of assets
In order to make money with this strategy, your business needs to have valuable assets to sell such as land or expensive equipment. Remember that profits from assets will have to pay creditors first. This may be an option if your business solely relies on a single individual.
There is no right or wrong exit strategy. It needs to best fit your personal goals and your business. By firstly deciding what you would ultimately like from the business, you gain a better insight into which exit strategy will best work for you. Regardless of the exit strategy, you need to plan in advance so you have the time to think it through, do it right, and maximise your returns.
If you would like more information on exit strategies or would like an exit strategy for your business, our experienced lawyers and accountants can help. Call 1300 QUINNS (784 667) or make an online enquiry.
