An exit strategy is something that every small business owner looks for. Any investor or ow
ner of a business, will ask themselves when is it time to move on?
Having an exit strategy worked out in advance helps ensure that you like the answers to those questions and gives you some control over your small business's future. Here are three exit strategies for small businesses to choose from:
This is the close-up shop and sell all the assets exit strategy. For small businesses, especially those that are dependent on the performance of a single individual, liquidation is sometimes the only option as there's really nothing else to sell.
2) Liquidation Over Time
In this exit strategy scenario, the owner(s) extracts most or all of the profits out of the business over time (before eventually selling or closing the business), rather than reinvesting them in the company for expansion.
3) Keep Your Business in the Family
The dream of many small business owners, keeping your business in the family ensures that your legacy lives on and provides a living for your heirs.
Can make for a smooth transition by grooming a family successor. May allow you to keep a hand in the business in an advisory (or other) capacity.
The Best Exit Strategy
The best exit strategy is the one that aligns the current or future stage of your small business and your short-term and long-term personal goals. Decide first what you want to walk away with. If it's just money, an exit strategy such as selling on the open market or to another business may be the best pick. If your legacy and seeing the small business you built continue are important to you, then family succession or selling to employees might be best for you.
Whichever exit strategy you choose, you need to start working on it. Planning in advance gives you the time to do it right – and maximize your returns.
Get started with your exit strategy today