What’s Your Exit Strategy?
Well, you’ve put your blood, sweat and tears into your business and it’s been lucrative. Your mortgage is almost paid off, the kids are on their way to college and while they still may come home afterwards, hopefully they’ll get a job and let you consider the next phase of your life.
Some of you may not be contemplating this right now, but at some point in time it’s a reality that you’ll have to face. The big question is, do you have or will you consider developing an exit strategy, or are you just going to liquidate your business?
This requires some major soul searching and there is no right answer. Personal aspirations and preferences come into play. The one sure thing is that a decision will have to be made.
Before you consider just throwing in the towel and liquidating, you should think about some possible alternatives that could be available to you.
While it’s not easy selling a business such as a custom retail or integration operation, there is one possible alternative. What is the competence of your existing staff? Is there an employee who could become your heir apparent? If not, is there someone you know who has the talent and ambition to, over time, step in and take over your business? Is there a friendly competitor who is younger that you would consider merging with? If the answer to any of these questions is “yes,” then you might want to consider coming up with a plan to slowly transfer the ownership of your business so as to allow you to effectively obtain an annuity.
I don’t profess to be an attorney or an accountant, but this is a real alternative worth considering with possible built-in safety valves to protect your interests. While you will need to consult with professionals, you might want to contemplate this possibility versus liquidation.
Be aware that a great salesman doesn’t necessarily make a great owner. Whomever