A rush towards the exit
Well what a few days it has been in the UK. I’m not in any way going to tackle anything remotely political with regards to Brexit and all of the subsequent debate here. But having reflected on the fallout over the weekend, what I am going to do is to refer back to a fairly constant theme in my previous posts in the context of the situation we have found ourselves.
The issue I’m going to refer to is planning – and specifically given the questions posed by Brexit – it got me thinking about exit planning.
It’s a quite staggering fact that only 3% of business owners have an exit plan in place.
I have written before about the benefits of having sound plans in place to help guide decision making, celebrate success and try and avoid or minimise the impact of challenges.
All of those reasons are equally valid when applied to the specific plan for exit. So if you are one of the 97% of business owners without an exit plan – ask yourself the following questions:
- When do you want/need to stop working?
- How much money do you need to be able to do that?
- How long will it take you to accrue the answer to #2?
- Which comes first, the answer to #1 or the answer to #3?
Consider being on public transport whether that is a bus, train or tube but you haven’t actually thought about when you want to get off, you are paying no attention to where you are on the journey and haven’t heard any announcements – you would be pretty lucky to get off at the exact stop you want to… if you have no idea what your ideal stopping point is as a minimum, how on earth can you expect to exit at that point?
There are all sorts of other questions and facets of a good exit plan but having a basic understanding of what you want to achieve is critical – it provides a frame of reference for what you are trying to do that helps understand if current performance gets you to where you need to be and if not what is the size of the challenge you need to tackle.
A thorough exit planning process will also take you through all the options for exit – are you planning to sell, hand the business on to family members or a business partner or just wind it up? Furthermore an exit plan will help determine the expertise you need to maximise the value and at what point you need to start to engage those experts.
Like any plan, a good exit plan will also have the flexibility to be able to cope with changes in circumstance or market conditions – such as those we are seeing now. Whilst the Brexit result may have surprised many the possibility it may have happened should not and that awareness allows scenarios and alternate strategies to be put in place.
So maybe now is the time to think about your personal exit strategy….