Starting, creating and growing your own business is fun, exhausting and rewarding. As you pour over page after page of business plan your start-up will teeter and falter but, all of a sudden, out of the blue it will take off.
The value of your business will soar, but did you know that at the same time you create a business plan, you should also be creating an exit strategy?
It seems almost ludicrous to suggest that you should have an exit strategy in place before you begin trading but, business experts will lecture that this is the way to start and run a business.
Business owners view their businesses with emotion, and no surprise when you consider the input over hours, days, months and years that they have poured into this entity. But for those with a cool business head, there are many advantages to keeping in mind an exit strategy:
Starting a business and making it successful is all about money. Making a profit is key because, without that, there is no business. However, it should also be about business value, something that we know all about.
An exit strategy is all about creating and maintaining as much wealth in a business as possible in order to maximise its value. A bit like keeping a car in good shape, with regular servicing and careful driving to avoid dents, the past performance of a business will contribute to the value placed upon it by potential buyers.
Running a business can be tough which is why many business experts and mentors always suggest an exit strategy from the start. This plan helps you to assess when the time is right for you to jump. In some cases, this jump can be a sale to the management team to shareholders and so on.
There is always a market for buying and selling businesses but, like other markets, there are times when it is buoyant and fast-paced, and others when it is sluggish. Knowing when to take the step is made easier when you have a clear idea of the value of your business.
Taking advantage of professional business valuation services does not mean that you have to sell. It means having a sense of the wealth, assets and value within your business so when you feel the time is right, you know you have all the information to hand that you need to make the best possible sale.