It is inevitable that you will exit your small business, whether it is to move onto the next big idea, gain more of a work-life balance or retire. Having an exit strategy (or succession plan) will help to make the exit from your business easier and give you a much better chance at a profitable departure.
When you exit your business, you have a few options, exiting can be complete or partial and can take the form of:
- Staying in a reduced capacity
- Let the business run itself and enjoy passive income
- Move on and try something else
In order to achieve maximum return for your business you need to start planning years in advance to prepare for the handover of a business.
How to make a small business exit strategy:
- What do you want your exit to look like?
- When do you expect to exit the business?
- What does the business look like when you exit?
- Will you sell, merge or walk away from the business?
- How much would you expect for the business?
- Remove yourself from the business
A small business is considered to be worth significantly more if it is not reliant on one person. The business should be able to run without you and a couple ways to test how self-sufficient the business is to:
- Stop doing the day-to-day work
- Rely on your staff to be the go-to person for your clients
- Delegate most hands-on work
- Put systems and procedures in place
In this day and age creating systems ensures there is a consistent image portrayed by your brand. Some aspects that you can consider systemising is:
- Procedures – Cloud storage can make documenting procedures easy and will ensure that no aspects of the business will fail if you or another key stakeholder is not there.
- Create templates for regular tasks in your business to maintain a consistent brand image.
- Automate aspects of your business for better efficiency in your business, NBC use Xero cloud accounting software to automate our accounting and Xero practice manager to automate and keep a track of workflow. Some aspects of your business that can be automated include:
- Staff scheduling and time recording
- Project management
- Customer relationship management
- Inventory management
Northern Business Consultants can help you with building your business for the best exit possible, for more information we have a free seminar on increasing the value of your business, book your ticket or find out more here. Alternatively contact us on (07) 3862 8777 for an obligation free consultation to see how you can ensure your business is ready for your exit.