It is probably not something that you like to think about it, but it's inevitable that one day you will leave your business.
Having an exit strategy for your business is an important part of your overall business plan.
You may not know when you first start up your business what your exit strategy will be. That’s fine. Early versions of your business plan may simply set out the options available to you regarding leaving your business. At some point it may become clear how you will exit your business.
This blog looks at the common ways of exiting your business and what you need to consider as part of your exit plan.
The different exits strategies include:
The first two exit strategies mean that your business will continue to operate into the future without you.
Selling your business
your original goals outlined in your business plan. Hence your business plan is likely to have been geared to growing and strengthening your business to maximise its value.
The steps involved in selling your business may include:
Selling your business can be a complex and time-consuming process.
It may be beneficial to seek professional assistance from a solicitor, an accountant or a business advisor.
ensure that your business continues to operate successfully through the process of transferring ownership and control with minimum disruption to the business.
The steps involved in a succession plan are similar to selling your business.
Your succession plan needs to be included in your business plan and is then reviewed regularly when you also review your business plan. Just as your business plan is a ‘living’ document, your succession plan can be changed according to changes in your circumstances.
A professional, such as, a solicitor, an accountant or a business advisor can assist you with your succession planning.
Closing your business
The time it takes to close your business will depend on your business structure and the specific circumstances and reasons for closing your business. Larger companies with complex operations may take several years, while a sole trader operating from home may only take a couple of weeks to close down.
Some of the steps involved in closing your business include:
Some of your legal obligations
Depending on the business structure you have adopted you will be required to:
Some of taxation obligations
There are certain taxation time lines that must be met when closing your business:
Many government agencies provide advice, templates and tools including templates of succession plans to assist you to exit from your business.
Why not make a complementary consultation with me today to go through with you how to plan to exit your business.
Whether you are selling, transferring ownership or voluntarily closing your business, it can be a confronting experience and emotionally challenging for you, your family and your employees.
Try to stay positive during this time. Should you need help in dealing with the transition you may wish to consider seeking professional assistance from a counsellor or psychologist or agencies such as beyondblue or Lifeline to help you deal with the transition.