7 Keys to a Successful Business Exit Strategy

7 Keys to a Successful Business Exit Strategy

Seven Keys to a Successful Business Exit Strategy

Getting from Point A to Point B requires direction. If you start with a plan, you can be proactive in getting both your business and your personal estate to the desired end goal. The following seven steps can assist you in growing and protecting the value of your business, transitioning the value of the business into personal wealth and then growing and protecting your personal wealth for current and future generations.

1
Begin with the
End in Mind
Then Continually Go
Through the Process
Begin planning your exit strategy with a clear, written definition of your personal and non-financial goals and the "happily ever after" number associated with them. Then, determine your target value for your business and your current and estimated future level of investment assets. Understand how your business interest will be valued when it is sold. Consider also how your business fits in the merger and acquisition marketplace. A strategic buyer often uses different valuation formulas, and the results from those formulas could guide your exit method. Do some research into your exit options and determine the relative risks and rewards of each. In this process, you should also factor in the tax ramifications of the timing of your receipt of the sale proceeds, as this will have an effect on the value you get from the sale. Cash flow and budget forecasting should be worked into your operational management to help make sure your business is on track to meet its target value. Strategic planning can assist in meeting your growth goals and the valuation multiple your business can realize on its sale. Robust internal controls, documented contingency plans and prioritizing your cash reserves to meet your economic objectives help you manage the value you created for your business. You also need to consider how to leverage your portfolio to grow your business. Exit planning requires the participation of multiple parties who are informed and work together. Enlisting the help of valuation, tax and strategic planning specialists can ensure your exit plan stays on course.

 

 

 

 

 

 

 

 

 

 

 

 

 

Learn more about the Seven Keys to Unlocking the Door to Your Dreams.