It is never too early to begin planning for a strategic exit from your business! While we like to think we are in control, you can never know what the future holds that could throw us off course. Putting in place a sound plan to exit your business will help facilitate a faster exit when the time comes and can provide for a higher return on investment.
The following options outline three of the possible exit strategies available to business owners when planning an exit.
Selling to Friends or Family
Advantages: Selling to friends and family can provide peace of mind that your company will be taken care of after you leave.
Disadvantages: The likelihood of selling to friends and family is slim, can mean a lower return on investment and outside financing can be difficult to attain.
Selling to an Internal Party
Advantages: Selling to an internal party, like a key employee, can be great because they already know how to operate the business, which is also helpful when seeking outside financing.
Disadvantages: This option is also prone to providing a lower than market value return and outside financing can be difficult to attain.
Selling on the Open Market
Advantages: This strategy can provide an owner with a valuable return on investment, especially when engaging a business broker to facilitate the sale. This option can also bring in multiple offers, giving you the upper hand in the sale.
Disadvantages: The sale process can be lengthy and the buyer may have their own plans for the business.