When Opportunity Strikes – Be Ready!

Written by James Sanders

Over the years, I have talked to business owners about their exit strategy and more times than not, I get a worried look.  It’s almost as if they have not thought about it (or don’t want to admit they don’t know).  They are so engrossed with running their business that they have not taken the time to think about who could buy it.  On the flipside, there are also many who think that one of their kids will just step in and buy them out.  If you fall into one of these two camps, I am strongly suggesting that you give your exit strategy some thoughts.  So, who or what could possibly be your exit plan?

Below are some ideas:

1. Competitor – if you are successful, a competitor may be a strong contender to be your acquirer;
2. Supplier – sometimes a supplier is looking to vertically integrate; if you are a strong customer for them, they may want to add your business to theirs;
3. Employee(s) – a key staff member or possibly all of our employees through an ESOP might be an option; they know the business and you know them;
4. Investor – if you are big enough, there is always the possibility that private equity or some type of investor would want to buy you out;
5. Family Member – if you have a family member involved (or a few), this could also be a good option

Below are some good articles that address this very topic at a high level:

• How to Sell Your Business With No Regrets | Kiplinger
• Selling Your Business Checklist: 20+ Mistakes to Avoid (PreferredCFO.com)
• How To Sell Your Business–A Step-by-Step Guide (Forbes.com)
• What to Know About Selling Your Business (business.com)

The bottom line – you don’t have to know exactly who will be your exit strategy, but be cognizant that there are many different options.  Also, be ready for the time (and it likely won’t be when you plan it) when one of the above does comes knocking on your door.  You never know when opportunity will strike….Be Ready!