If you're thinking of exiting your business in the next few years, you might want to consider what it will take to get your business ready to transfer to the next generation of owners. Exit planning can help make this process as smooth and successful as possible.
What is Exit Planning?
Exit planning is the process of enhancing the value of your business, so that you get a better price for your most valuable asset at sale.
Who is it for?
Business owners who are looking to step back from the day to day operations of their business, without compromising the value of what they've worked so hard to build.
Why does it matter?
Without an intentional plan, most businesses are liquidated piece by piece, not unlike an old car being disassembled for spare parts and scrap metal. Most of the real value of the business, which often consists of the owner's knowledge and relationships, is lost.
How does it work?
Buyers usually want something predictable, with low-risk, that isn't dependent on its founder for future success. There are several components to this, but the overall goal is to mitigate risks and enhance the attractiveness of your business for the future buyer.
When should owners start considering exit planning?
Exit planning takes time. If you think you might like to sell your business in the next 5 years, it is a good idea to get started now.
Where might you see yourself in 5 years?
Many business owners leave their business to focus on other areas of their life, whether personal passion projects, enjoying their relationships, or even starting a new venture. However, it doesn't have to be all or nothing...
Because exit planning is ultimately about preparing your business to run without your day-to-day involvement, many owners find themselves with greater freedom than they've had in years, even before a complete exit. This means more time to do all the things they've been putting off, as well as more time for the aspects of their work that they love.