Exit Planning

When we meet with you we will usually talk a lot about Exit Planning and Succession Planning. WHY?

We are convinced that all decisions you make in your business should be driven by your Exit Plan, which will often include a Succession Plan. This is because your Exit Plan will establish very clear goals to aspire to and which all startegies and tactics must be checked against. If any strategies or tactics do not contribute directly to the achievement of your Exit Plan then you need to ask “why are we doing this if it will not meet our overall goals”.

If you’re not considering selling your business or retiring and letting management or family members run it, why do you ened an Exit Plan?

  • Because it establishes clear, concise, ambitious and achievable targets for your business to reach.
  • It provides clearly understood reasons for growth.
  • Every plan or strategy you implement needs an easy reference to why you are doing something. Your Exit Plan provides that clear reference.
  • It enables you to decide whether capital investment is “nice to have” or “need to have” based on what stage you are at in your Exit Plan. After all, there is no point investing in new capital for the next 10 years of operations if you will be selling your business next month.
  • It provides a clear focus on the most important reason that your business exists – to make superb profits for it’s shareholders.
  • It enables you to track progress on a regular basis against real goals rather than “everything seems ok”.
  • It is the most important form of contingency planning you will ever need, just in case the worst happens, such as serious illness, sudden death or divorce. You or your management team will have a clear direction to take and a business that is correctly positioned for sale at the maximum possible price.
  • It enables you to sell your business at any time in the future for maximum value, because it has concisely covered all aspects such as: minimum price, how it will be sold and who it will be sold to (general groups of targets and also specific targets).
  • Because businesses are sold either as a financial sale (where the main factor determining price achieved is your profits) or a strategic sale (where the synergies, experience, attributes and skills of the buyer can grow the profits even more). By having a clear Exit Plan, you will have a better chance of achieving a strategic sale which always maximizes the price you achieve.
  • It is updated every 12 months to reflect changed circumstances of shareholders as well as the changing market place and your progress over the preceding 12 month period.

Preparing your Exit Plan is not as hard as you expect, the long term rewards can be huge and your business will also be easier to manage. If you’d like to discuss your own Exit Plan, call Martin Dabb  ph; 0458 290 100 (Perth) or Email Me to discuss any issues or questions.

 

 

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