Many small business owners do not have an exit strategy in place, because people who run businesses tend to focus a majority of their efforts on being in the business or competing in their industry.
What is an exit strategy?
An exit strategy is the strategy for how you will eventually transfer ownership of your business to another owner when you have decided to move on or retire.
Why is it so important to have an exit strategy?
A planned exit strategy will help reduce owner dependency and perhaps further empower staff that can either ascend to ownership, or help a new owner successfully continue to run the company into the future. It also reduces the worry during that period when the decision is made to transfer ownership.
How long in advance should you begin to plan their exit strategy?
An exit strategy should be included in the business planning process at the beginning of the business. If this has not happened the sooner a plan is put in place, the better prepared an you will be when an exit is available.
Is it necessary to hire a consultant when planning an exit strategy?
It is advisable to seek advice when developing your exit strategy; you can seek advice from your accountant as a starting point. This is particularly important due to the many different taxation consequences that could arise.
What is the most important thing you should know when thinking about exiting your business?
Developing and exit strategy takes time and you should put a lot of thought and analysis into it to get the best possible outcome. I you make the investment of time; you will be rewarded for it.
I invite you to attend one of our 6 Degrees of Separation events to discuss this issue in more detail. For more information check out our web page at www.shchamber.com.au or call 0477012151.