Determining when and how to exit a business can present
issues often more challenging than starting the business. Here are a few thought starters for owners
looking for a way to exit their business.
·
Is the business operated from strong
principles of strategy with a clear vision? Can that vision be expressed and
understood by those who manage the business or potential buyers? If you the
owner cannot clearly state the purpose or reasons that you exist don’t expect
new owners to invent it for you.
·
How will you get the maximum
return if you plan to sell? In cases where management/ownership is dominated by
a single individual there is a risk that customers will not have confidence in
new ownership unless the current owner can provide an effective transition plan
that ensures continuity of the business operations. Current owners may need to
plan for extensive transitional training.
·
Factors that may support your
decision to leave can grow out of many conditions. The most common are age or
health related. A long career leading to a desire for more personal time; reap
the rewards of your career. Age may not be the prime driver but longevity at
the job could be creating burn out. It may be time to move on.
·
Look for opportunities to exit
from positions of strength. A well trained and competent management group may
provide the opportunity to offer your staff a management buyout. Managers may be able to pool resources to
fund the buyout, you as owner may offer to finance all or part of the buyout or
there may be an option to use company assets to finance the loans needed for
the buyout. It also provides good opportunities for maintaining stability in
the organization.
·
Finally, the marketplace may
facilitate determining the right time to exit. Poor economic conditions or
competitive activity can have a huge impact on if or when you should exit.
Positive conditions too might bring a competitor to the door with a buyout
offer.
So the options are many but not always easy to
sort through. Timing is critical, business life changes, choose wisely.
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