The most effective exit planning is really building a great business – a process that identifies the strategies and tactics that will take your business to the highest level of profitability and increase its value.

To get there, your entire management team should have a seat at the table to make sure everyone is pulling in the same direction. From finance to operations, sales, marketing, and human resources, your leadership team manages your key processes to make your company successful and achieve best in class status.  If anyone of them is left out of the planning process, you will lose management buy-in and your profitability will suffer.

So they should be collaboratively working together, contributing ideas, and sharing their experiences as you consider how to improve business processes and profitability.

If you build a management culture based on consistently seeking ways to maximize your company, its returns, and its employees, when the time comes to succeed in your business, the hard work is done.

Not a Fire Drill

Exit planning should not be a fire drill you go through in the last three to five years of your business ownership. It should start on the day you start the business.

Think of it this way. When you start a business, your goal is to do whatever is necessary to make it as profitable and valuable as possible. As the company grows and matures you will need to hire good people whose talents and ideas make the company even stronger.  Developing a great culture with an incentive system will help you retain them. That is the kind of energy – “startup momentum” – that will drive the management of the business throughout its life, pushing it to its highest possible level of profitability and enabling you, as the owner, to seize opportunities that occur along the way.

Opportunities may include selling the company, potential mergers with another company or even a chance to buy a competitor and grow exponentially.

Communicate with Your Team

If you communicate your goals for the company, it gives everyone who works for you something to strive for. It provides milestone achievements and helps you build a team of people who are excited to come to work every day.

Employees who believe they have a stake in reaching your goals feel a sense of “ownership.” Everyone likes to be part of something successful and pushing your team to achieve greater things will bring everyone along for the ride. All of this contributes to making your business a company that is highly marketable.

Too many business owners consider exit planning a secret process in which only they have a stake. But involving your leadership team in the process empowers them to be better employees. They feel they are part of a true team and it keeps them engaged as the business continues to evolve.

This benefits the business and you in the process.

Let’s have a discussion about how you can engage in building a great business and feel assured you have your exit plan well in hand. For additional information contact your Barnes Wendling advisor.

Related Insights