Business Exit Planning in 5 Stages

Preparing your business for a successful transition is crucial in enabling your next great adventure and preserving your legacy. In preparation of the journey ahead, you would think that business owners would plan aggressively to set themselves up for success; yet ~60% of businesses don’t have a written exit plan. The main obstacles that business owners cite for not creating an exit plan are that they feel overwhelmed or they think they have more time than they really do. Why This Matters:

Typically 80% of a business owner’s financial assets are tied up in their business. A great exit plan is needed to make sure that the value built up over many years can be accessed by them. Sadly, nearly 50% of business transitions happen involuntarily via one of the 5 D’s (death, disability, divorce, disagreements or distress). Having an exit strategy in place reduces the chances that one of these events will have a traumatic impact on you as the business owner, your family, employees, customers, vendors and community.

Len Bruskiewitz

I’m Len Bruskiewitz, a Focal Point Business Coach and Certified Exit Planning Advisor who helps business owners increase the value of their companies and build a great exit gameplan to enjoy the process. I’ve worked with business owners to prepare their companies to sell to 3rd parties, pass along to a family member and/or transition to management/employees. I can help you create a scenario where you are spending less time working, generating more profit and stressing less about the future.

As a first step in planning for you business exit, this article covers the 5 stages you need to take to get your company ready to transition on your terms and timeline.

Stage 1 - Decide on Personal Goals & Timeline

• What is your next adventure?

• Determine “walk away” value for your company

• Transition complete in 3, 5 or ? years?

Stage 2 - Determine Current Valuation

• Professional valuation sets baseline & identifies gaps to goal

• Assess accounting practices (bad bookkeeping is one the biggest deal killers)

Stage 3 - Enhance Business Value

• Get independent from your business so someone else can step in and run it

• Address risk factors from valuation

• Develop growth strategies that increase value

• Document processes

Stage 4 - Assess Exit Options

• Internal - family succession, sell to management/employees

• External - sell to 3rd party, take on outside investment

Stage 5 - Review Legal & Tax Implications

• Tax strategy based on exit option chosen

• Legal readiness 

• Estate planning

Next Steps:

Take the FREE Business Valuation Calculator quiz on my website: www.greaterheightscoaching.com. In 15-20 minutes, you’ll have a basic idea of what your company is worth now, as well as ideas on how to increase its value. Len Bruskiewitz's is a guest writer. His opinions may not reflect that of BizRetire. Always use sound judgement and consult professionals when making any business decisions.