WHAT IS AN EXIT STRATEGY?
An Exit Strategy is a long-term plan for transferring the ownership of a company from one owner to another. The characteristic of a "Plan" means it is conceived long before it becomes desireable or necessary. This is what distinguishes an Exit Strategy from more abrupt actions such as selling out.HOW MUCH TIME DOES IT TAKE TO EXECUTE AN EXIT STRATEGY?
To have a good chance of getting what they want, Sellers should give themselves plenty of time to lay the groundwork for a sale. This isn't done in a matter of weeks, but rather in months, and in many cases, years. Unfortunately, research shows that 70 percent of business owners don't have an Exit Strategy.WHAT ARE THE STEPS TO ESTABLISHING AN EXIT STRATEGY?
One of the first steps a Seller needs to take is getting a thorough understanding of what they have to sell, or what they could have to sell that somebody else might want to buy. In other words, Sellers should spend time identifying types of potential Buyers and find out what they're looking for.
The second step an owner should consider is to understand what happens during the sale. This refers to issues associated with the actual transaction such as contracts, vendor relations, customer service, key personnel, etc. which can impact the sale.
The third step is the Seller's personal financial plan after the sale. Does the sale of the business satisfy the needs the Seller faces during the next 10, 20, or more years?WHY IS AN EXIT STRATEGY IMPORTANT?
As business owners plan for an orderly transition away from their business, it is important to take the time to explore options so that the greatest potential return is achieved for the business. Planning for their Exit from a business can be as difficult as starting a business. HOW CAN I BEGIN DEVELOPING AN EXIT STRATEGY?
Contact a representative from Liberty Business Brokers of Ontario who will assist in beginning the process to develop a Plan that will satisfy your needs before, during and after your sale.