For the majority of us, owning a business is a means of making money and paying our bills. We’ll pore tirelessly over paperwork and processes looking for ways to increase our companies’ day-to-day profits, yet when it comes to exiting our businesses, we seldom take the same care in finding the most financially beneficial solutions.

With an exit strategy in place, you can ensure that you’re continuously working toward the best possible outcome when it comes time to leave.

Start thinking about how and when you’d like to exit

It’s never to early to formulate at least a loose plan of how you expect to leave your company. The good news is that by making your business as valuable as possible to buyers, you’ll likely increase your profits in the interim too.

Selling up isn’t the only option though. Many business owners decide to pass their company on to a friend or family member. This requires no less planning either, and often calls for a degree of flexibility too.

Finally, the other main option when exiting a business is to close it down. Most are loathe to think about closing down a company that they’ve put so much time and effort into, but occasionally it’s the only option.

If you’re looking to sell up

Your business is an asset. When you eventually decide to retire or move on to other ventures, you’ll likely want to realise as much value in it as possible.

Anything you can do to the company to increase profits will of course be beneficial when it comes to selling, but it’s not the only thing you should consider. If you’re close to your preferred exit date, for example, you may wish to hold off on that expensive new machinery that would take a few years to pay for itself. Of course, newer and better equipment can also attract more buyers too, so make sure you weigh up your options before spending big when you’re close to exiting.

Other factors can make your business more attractive to buyers too. For instance, a business situated in the middle of nowhere may make no extra profit than one in a city centre, but thanks to a larger pool of potential buyers they’re more likely to not only command a higher fee but sell in the first place.

If you’d like to pass it on to a family member

An unfortunate number of handovers to a family member fail because the recipient is either not ready or interested enough to take the reins.

If you have someone in mind to take over the company, it’s a good idea to employ them beforehand. That way, they can get an idea of how your business works before they’re suddenly handed the keys.

It’s recommended for potential heirs to work their way up through the majority of roles in the business so they can build a comprehensive set of skills specific to your company. However, this isn’t always possible. At the bare minimum, they should have been allowed to shadow you as you run the business and had chance to perform some of the tasks themselves.

Ensure that you check in with them regularly to determine that they still want to take over, and that they haven’t lost any interest in the project. Things can change over time, and they could well decide that their career lies elsewhere.

Thinking of selling your business in the future?

Ensure that you eventually achieve the best price possible for your business by looking at your exit strategy today. Forbes Burton specialise in helping business owners to receive the value from their companies that their hard work has deserved.

Not only can they put measures in place to increase your company’s value, but they also have access to a wide network of active investors and businesspeople they can put your business in front of.

With free consultations and business valuations available for business owners thinking of selling, Forbes Burton should be one of the first ports of call for anyone looking to exit their company. Call for no-obligation advice on 0800 975 0380, or find out more about their business exit services here.