Creating a plan for your exit strategy

Exiting your business is a big commitment. You’re leaving behind everything you’ve built up, so it’s vital that you have a plan of action and a clear route to your end goal. This means sitting down with your advisers to create a long-term exit strategy, with a plan that's aligned to your key goals, aims and financial commitments as the owner.

Coming up with this plan won’t happen overnight. A business sale is a complex process with many different elements that all have to be considered. A workable plan, will give you a helpful route map to guide you along the way.

Here are some of the fundamental things to think about when writing your plan.

Know your sale price

As the vendor, you need to come up with an asking price for the business. Your sale price isn’t just driven by market forces. It’s also dependent on how much money you need to raise.

If your aim is to start a new business, think about how much capital will be needed to get this idea off the ground. If your goal is to retire, you need to work out the size of the lump sum that will be needed. You could live for 20 or 30 years post-retirement, so any cash raised has to provide you with your desired income and lifestyle for a number of years. Don't forget to allow for any tax that may be payable on profits you’ve made. We can help you estimate that.

Work out what funds you will need to retire or invest and make this total cost the benchmark for your ideal sale price. If you’d need 10Mill over 20 years, you know that your asking price must leave you with more than that after tax to provide a cushion for your finances.

Get the business valued

The next step is to understand the value of the business on the open market. This means talking to your accountant who may advise you to talk to a M&A (mergers and acquisitions) expert.

Value is a complex measurement. It can be influenced by your brand’s reputation, the business’ current financial health, the worth of your company assets or the skill of your existing team. A change in any of these elements can have a huge impact on your sale value – and, as a result, the size of the profit that you and your departing shareholders will make from the sale.

If your current value is projected as 8 million, but your initial asking price must be 10 million or more, there’s some work to do to add this value and boost your final sale price.

Decide on a successor

Every business needs a safe pair of hands at the top. Thinking about who will take over the reins, and how to make this transition run smoothly, is a vital part of your exit strategy.

A succession plan explains your own plans for retirement, who will take over your role and the timescales for this succession process. It may be that a family member is your intended successor. It could be that your intended buyer will take on the owner-manager role. Or it could be that a current member of your executive team is ready and willing to step into your shoes. Make sure you’re clear about who the new boss will be, and how (and when) this person will succeed you as the leader of the business.

Work out the timescales for selling up

Selling your business is rarely something that happens quickly. Preparing for a sale can often begin years before the proposed date of exit, so it’s important to be clear about your exit strategy and the key dates along the main timeline.

A five-year exit strategy is common, and you should allow at least two years to complete the process from beginning to end. Selling up may seem like the final scene in your business play, but in fact it’s only the beginning of a long and protracted final act. The more you can do to plan each step of the exit, the more successful your final sale will be.

If you think now is the time to start planning your exit, please do get in touch with us. We can help you value your business, work out your benchmark sale price and achieve the best possible sales price.

< Older Post

Newer Post >

Tips for Moving Day

17 April 2025

It's that time again and Moving Day is upon. Moving Day' is a big day in the farming industry. To help you with a smooth transition here are some tips: Early preparation Make sure sharemilker or contract milker contracts are signed. Plan a farm inspection with relevant parties (farm owner, incoming and outgoing sharemilkers, farm manager, advisor). Recruit and finalise employment agreements for new farm staff. Communicate plans and dates with everyone involved. Contact your insurer and utility providers. Farm owner responsibilities Make sure employees leave the houses clean and tidy. Carry out house inspections for maintenance. Comply with healthy home standards. Confirm departure and arrival times with tenants. Consider drug testing, if needed. Animal movements and biosecurity Plan animal movements carefully. Clean and disinfect farm equipment and machinery. Minimise the risk of introducing exotic pests. About 5,000 farmers do this every year. Talking clearly and planning well makes this important farming tradition go smoothly.

Selling Your Business: What’s Next After You Exit?

11 April 2025

Selling your business is a huge milestone—one that marks the culmination of years of hard work, dedication, and vision. But once the deal is done and the dust settles, you may find yourself wondering, “What’s next?” Exiting your business opens up a world of possibilities. Here are five potential pathways to consider as you embark on this new chapter of your life. 1. Enjoy Retirement For many, selling a business is the gateway to retirement. After years of being immersed in the day-to-day demands of running a company, retirement offers the opportunity to slow down and enjoy life at your own pace. Whether it’s traveling, spending time with family, or taking up new hobbies, retirement allows you to focus on the things that bring you joy. Planning ahead—both financially and emotionally—will ensure you make the most of this well-earned time. 2. Invest in Other Businesses Selling your business doesn’t mean stepping away from the business world entirely. Many people choose to invest in other businesses, whether it’s through buying equity, becoming a silent partner, or supporting start-ups. Your years of experience give you a unique perspective, and investing allows you to stay connected to the business community while diversifying your income streams. 3. Start a New Venture Once an entrepreneur, always an entrepreneur! If you have a new idea or are passionate about exploring a different industry, selling your business can provide the resources and freedom to start fresh. Whether it’s launching a tech start-up, opening a café, or pursuing an entirely new market, starting a new venture keeps your entrepreneurial spirit alive. 4. Become a Non-Executive Director Another pathway is to leverage your expertise and become a non-executive director. Many businesses value the insight and guidance of experienced business people. As a non-executive director, you can provide strategic advice, mentor leadership teams, and help shape the future of other companies—all without the full-time commitment of running a business. 5. Pursue Philanthropy For some, selling a business is an opportunity to give back. You might choose to support causes you care about through charitable donations, creating a foundation, or volunteering your time. Philanthropy not only helps make a difference in your community or the wider world but can also provide a deep sense of fulfilment and purpose in your post-business life. Charting Your New Path Exiting your business is both an ending and a beginning. It’s a chance to reflect on everything you’ve achieved and to embrace new opportunities that align with your goals and passions. Whether you’re ready to relax and retire, dive into new ventures, or make a positive impact through philanthropy, the choice is yours. Whatever path you choose, careful planning will help ensure your next chapter is as rewarding and successful as the one you’ve just completed. If you’d like support in exploring your options or preparing for life after your business, don’t hesitate to reach out us for guidance.

How to Protect Your Business from 2025's Cyber Threats

7 April 2025

Cybercriminals are constantly finding new ways to trick businesses, and their scams are harder than ever to spot. Small businesses are especially at risk, often seen as easy targets due to limited resources or weaker security. But with the right precautions, you can protect your business and prove the scammers wrong. Be Aware of New Threats Staying informed is your best defence. Here are some of the latest cyber threats: AI-Powered Scams : Scammers now use artificial intelligence to create convincing phishing emails and fake websites that are difficult to distinguish from the real thing. Impersonation Attacks : Posing as banks, government agencies, or suppliers, attackers aim to trick you into sharing sensitive information. Deepfake Technology : Fake audio and video messages that mimic trusted sources are becoming more sophisticated and harder to detect. Train Your Team Educating your team is crucial. Teach them to: Spot warning signs, like urgent requests to act quickly. Double-check email addresses and URLs before clicking on links. Be cautious with unusual requests, even if they seem legitimate. Regular training sessions and phishing simulations can help your staff stay alert and recognise scams before they cause harm. Protect Your Business Basic but effective security measures can go a long way. For example: Enable two-factor authentication to secure your accounts. Keep your software and systems up to date. Use resources like the Business Online Security Series for practical cybersecurity tips. It's also wise to consult with your IT provider to evaluate your business’s vulnerabilities and develop a cybersecurity training plan for your team. Taking action now can save your business from potential threats while safeguarding your reputation. Stay informed, train your team, and strengthen your defences!