Exit strategy.
Plan with the end in mind.
Exiting a business. What are some reasons to exit your business?
First I would like to address a misconception about starting a business: Work on your business, not in your business.
People will have an idea or a passion and end up building themselves into the business. Ultimately when the time comes to make a transition the ownership finds themselves stuck in the daily operations, unable to see an exit or even unable to really enjoy what originally started as a joyful endeavor. By working on, instead of in, your business empowers you to create autonomous organization that is not reliant on ownership as the sole champion.
Positive
Now, there are many reasons to leave or exit your business. Perhaps you business is doing well and someone approaches you to buy, or maybe you begin looking for a buyer? There may be personal reasons behind the decision to sell. Or you may have enjoyed the start-up phase and are now a few years in and are ready to let go for a new idea. These are all reasonable and common exits.
Selling your business will require due diligence and another reason why planning and having appropriate financial systems in place make this an easier process.
Negative
On the flip side there are other reasons to leave. Perhaps revenues are sluggish and you are have been slowly losing faith in the business. This might be a sign to reconsider where you are and what you are doing. Our lives are meant to be joyful and if we find ourselves being worn down physically and emotionally we certainly are going to have a hard time feeling that joy.
Something else that can happen to inexperienced business owners that would cause them to divest or sell a business would be lack of planning or forethought in the early stages. An example from the service industry: restaurants are tough businesses to operate due to the high overhead costs and narrow margins for profitability. Someone who enjoys food and cooking might think opening a restaurant is easy yet be unprepared to meet the demands restaurants require. Generally speaking, it takes a lot of accountability and work-ethic for businesses to succeed and if you are unwilling to put that effort in then the business will most certainly will sustain itself.
