The Best Time to Plan Your Exit Strategy
There are many reasons people decide to start their own business. For many it is a desire to leave employment, or perhaps the opportunity to take redundancy, and to exploit the skills they have acquired, often over many years, for their own benefit.
Usually the last thing on their mind at this point is an exit strategy. Their main priority initially is purely survival. But beyond that, what comes next?
All businesses should set a long-range goal as early as possible regarding how and when to exit. This will provide a backdrop to investment strategies, i.e. when and how much to invest in new plant and new people. Year-on-year results and changing market forces will cause these decisions to be fine-tuned along the way, or indeed the overarching goals of the business owners may change significantly, but the most important thing is having an up to date plan.
So why exit?
Often the driver is retirement or ill health. But is could equally be to spend more time with the grandchildren, or embark on long-overdue and well-earned travel, or play more golf? Many people are multiple entrepreneurs, and sell one business to start or fund another.
For most business owners, they sell only once and it can be very difficult to pass their baby onto new custodians, and it can take great resolve to walk away. At the same time, if they are caught up in day-to-day operations, they will often ask themselves: “Why am I doing this?”
We see many business owners put off their exit because they are scared of the unknown, and think they can’t afford to step down. Others think they can spend just another couple of years building it up, so then it will REALLY be worth something worthwhile. This is all perfectly understandable, but it can be dangerous to hang on too long.
When is best time to plan your exit strategy? The answer is now.
We at Hornblower are experts in our focus markets of engineering and professional B2B service sector businesses, and we will happily have an informal discussion without any commitment on your part on how we can help you realise the value of your business and what it could be worth. You’ll be amazed how liberating it can be to air your concerns and your ambitions with someone completely independent.
Whether you intend to exit in the near future or the longer-term, contact us now to start the process of planning your exit sooner rather than later.