Making a gracious exit from your business and finding a successor

It’s come to that moment. You feel like it’s the right time to leave your business that you’ve put so much work into over the years. You feel you like you want to walk off into the sunset. Take a break. Take a holiday. Take up golf. Take retirement. Anything, but doing business every day.

The thing is, how do you make a stylish departure? Well, there’s really only one answer to that. Have the right exit strategy in place. Whether your business is a family owned business or a more widely owned enterprise, having a well thought out and documented exit strategy or succession plan should be part of your business planning process.

And even small businesses need succession planning.

Set clear goals

Decide how, when and what you’d be happy with to exit your business. Consider the options. You might want to find a successor with all the right attributes to take the business forward in the way that you’d like.  Other options are transferring your business to your family members, a management buyout or selling or merging with another competitor. Another thing to consider is whether you would like to have ongoing involvement, income from your business, or just make a clean break.

Find a successor

If you feel that your involvement is still critical to the day to day running or your business, determine what needs to be done to change your involvement. It’s at this point where you should organise a successor who could be a current employee of your business. You then create and implement a program as soon as possible that will equip them with the skills and knowledge they’ll need to continue to take the business forward successfully. If you’re the only person that knows the business back to front, then you are putting yourself into a corner. It’s essential that you’re grooming your team members to be able to run the business effectively and profitably in your absence.

Have effective systems in place

It’s key that you have created solid systems that support every aspect of your business operations, from financial to management, to marketing and HR. Document these systems so they can be easily understood and followed by a third party.

Know the worth of your business

A good idea is to have a chat to your accountant, business advisor, or even a professional valuer with relevant experience in your industry and ask them to produce an evaluation so that you know exactly where you stand. Once you have this at your fingertips, the information and knowledge about the specific factors that impact on the value of your business, you’ll be able to create an action plan for maximising the value of your business before you make your grand exit.

How to action your succession plan

It’s vitally important to determine the strategies of how your exit plan will be successfully implemented. Keep in mind the impact that it will have on the stakeholders, the timeframes involved for each and every part of your plan, and the communication of your plan.

If you would like any further assistance in implementing a succession plan for your business, connect with us. We live for this stuff! Seriously.