The Time to Plan Your Exit Strategy is NOW

Business succession planning should be a priority for every family business, however, industry surveys indicate that 75% of business owners have no idea how they will exit their business.  Most business owners probably don’t think they are anywhere near the point where they should be planning their exit strategy. Wherever you are in the life cycle of your business, it is the perfect point to be planning for your departure from the business.

Sooner or later, everyone wants to retire. But if you own a family business, retirement isn’t just a matter of deciding not to go into the office any more. Besides ensuring that you have enough money on which to retire, the whole question of what happens to the business becomes paramount. Who’s going to manage the business when you no longer work in the business? How will ownership be transferred? Will your business even carry on or should you consider selling the business to current management or to a third party?

An exit strategy can mean different things to different people. If you started your business later in life, your exit strategy may be directed towards creating a retirement nest egg that will ensure your lifestyle is maintained at the level to which you are accustomed. If you are younger and find yourself running a successful business with great potential, your exit strategy might be to sell the business in a few years to generate a windfall that you can then use for other entrepreneurial ideas you want to pursue. For many, the business they started was based on a talent or passion.  Now that this has been successfully accomplished, you may want to stay with it and continue to enjoy the challenges for many years. For this entrepreneur, the exit strategy is going to be directed to the creation of a strong succession plan.

In each case, there are strategies you should be looking at well in advance in order to accomplish your exit goals. By establishing a plan years ahead, you will ensure when the time comes that you, your company, employees, family and the new owners are ready for the changes. The exit will take place on your terms and at a time of your choosing.

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