Exit strategies are the options that you have to leave your business. There are only a few exit strategies that Ohio business owners can choose from and each will provide you with a different level of proceeds when you leave. All strategies will require planning and time to implement.
It’s never too soon to start planning your exit. You will eventually leave your business, and it’s better to do so before a life-changing event forces you out. The sooner you plan, the more options you will have.
Evaluating Your Exit Strategy
Maybe you have a clear plan for how you will exit your business. If so, do you know the value of your business? Do you know what the after-tax proceeds will be? Does this amount, along with your other assets, provide you with the retirement you desire? After seeing how your plans play out on paper, can you retire the way you want to? If you can’t, you might need to consider a different business exit strategy.
Picking the Right Exit Strategy
What if you don’t know your exit strategy? How can you make a decision in this important area?
It will take time and hard work to make sure you have the right plan. If you take the following steps during the next 12 to 18 months, you will be closer to having a well-defined exit strategy and succession plan:
- Study the various exit strategies and understand the advantages and disadvantages of each strategy to your situation.
- Estimate the net after-tax proceeds that will you will obtain from each exit strategy.
- Reflect on how your exit will impact the future of your family and the employees of your company.
- Know how you will spend your time once you leave your business.
- Have a dialog with family members, key employees and advisors about your preferred exit strategy and how it will impact them. A family strategic plan is a useful tool.
- Finally, select the strategy that best meets your personal, financial and family goals.
- Start the implementation process early
For more on picking the right exit strategy, read my series, Six Steps for Successfully Transitioning Your Family Business.
Exit Planning Help
Need help deciding which business exit plan is right for you? Contact Rea & Associates. Our Ohio business valuations team will help you chose an exit plan. From selling your business to leaving it to a family member, we’ll help you to get your business in its best shape for your eventual exit. Offering a full range of business planning services, Rea’s team will help you set a course for a smooth business exit and comfortable retirement.