A Strong Exit Strategy Equals A Smooth Transaction
An exit strategy is simply a plan you put in place as a business owner to ensure a smooth exit from your company.
It is a crucial step in the selling process and one that all owners should have at their fingertips when it’s time to sell.
There are many steps to creating an exit strategy, but each is equally important.
Step 1: Define Your Goals
First, you have to know what you want to achieve by selling. Are you looking for financial security? Ready to retire or make time for other business ventures?
Step 2: Receive a Valuation
Work with your financial partners to get a thorough valuation of your business so that you understand its worth. You also need to know its marketability and growth potential.
Step 3: Explore Exit Options
Selling your business outright is not the only way to let go of this responsibility. You may also consider management buyout, employee stock ownership, IPO, or liquidating your assets.
Step 4: Prepare Your Business
When you have made the decision to sell, it’s time to clean up the financials, reduce debt, expand your customer base, and have a well-developed and defined succession plan.
Step 5: Assemble Your Exit Team
In addition to yourself, you should also work with a business advisor, such as First Choice Business Brokers, an accountant, and a lawyer.
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Step 6: Choose The Timing
Selling a business is a strategic decision dependent upon market conditions, business performance, and personal goals. All three of these need to align to make it the optimal selling time.
Step 7: Market Your Business
Marketing a business resale is not easy. You need to be confidential and use the right marketing materials. This is where a partnership with First Choice Business Brokers is so valuable. We can keep your confidentiality while marketing and negotiating effectively until you are ready to announce your exit.
Step 8: Do Your Diligence
One of the last and most important steps is to be diligent and know that your buyer is providing the right information to take over your business. While this may not be the final piece of the process, overlooking the diligence aspect of selling can leave you scrambling for another buyer.
This is not intended as a full guide to creating your exit plan. Instead, the above can help you get a better idea of what’s expected throughout the process. Talk to your First Choice Business Brokers advisor if you’re ready to sell your East Tennessee business, and let our professionals guide you through the process.
