Why exiting your business should be at the beginning of your business strategy

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Deri Llewellyn-Davies
CEO
Business Growth International
deri@bgistrategy.com

Do you intend to exit your business? When?

When I’m talking to business owners and ask these questions, very rarely do I get more than a couple of people putting up their hands. Then I make the very bold statement that every single person will exit their business whether they like it or not; we will all exit our business.  The only question is whether we do so in a coffin or in a taxi to the airport.  The time to plan for that is now, whilst you have the time to influence the future that you want, and the legacy you want to leave.   Wherever you start, you should always do so with the end in mind.

In my experience, I would say that the majority of business owners started their business in order to provide a certain amount of finance and safety and security and abundance for their family. Ironically though, if they do not put the right systems in place, the very vehicle that they are setting up, to create the freedom that they want for their family could be the very vehicle that leaves their family impoverished when they go.

If you do not have the right succession plans or the right exit plans in place on your business, and you do happen to die, then you leave a very very big problem for the family left behind. The problem may be so complex that it probably won’t be unravelled. As a result, the business would collapse and may even leave your family with debts and problems in your wake.  That’s just from poor planning, and poor strategy.  That is why this stuff is so important.

So, when we’re looking at the long term strategy, it is really important to have your preferred exit scenario clearly in mind and to picture what that looks like, and you have a number of choices.

For example, one solution is indeed to sell. You build a company over three to five years with a clear plan to exit, sell on to somebody else and then probably set up another one. That’s very much the mark of a serial entrepreneur.

For many SMEs, the mindset would be different. For them, it is a lifestyle business and built around their passions and what they really enjoy. They are in this for life and so need to have a different strategy in place, such as the exit of self or removal of self over time.

This means just putting in and layering in the right senior management team within the company so that, maybe within three to five years, you can exit yourself and leave the company in good hands.  You would still own the company and maybe act as chair person or

chairman or even as a non-executive director, but the company effectively runs itself and you just reap the dividends.

The important thing is that you have the choice of having some active involvement if you wish, but it’s entirely up to you. Giving yourself choices is the key thing in exit.

Deri Llewellyn-Davies has worked with hundreds of companies helping them get clear on their strategy.  His new book BGI Strategy on a Page™ published in March became a best-seller on Amazon overnight.  For more information visit http://bgistrategy.com/strategy-on-a-page/

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