Build a Better Exit Strategy

Passing or selling the business you have set up to a son, daughter or other family member can be an attractive option. It allows you to maintain an involvement in the business and pass the assets to your heirs.

If you plan on passing the business on to your children then it can help to involve them in the business as soon as possible, allowing them to gain an in-depth understanding of how things work.

Allowing them to gain experience working in other businesses can be equally important, as this will give them new strategic insight into your activities.

What is the liquidation option? It is the direct conversion of assets to cash by selling them to a user/consumer. There are generally three categories of business that will liquidate assets:

Businesses with assets used indirectly in the production of income

Businesses with assets used as tools in the direct production of income

Businesses whose assets directly produce income

Strategic buyers are companies that want to acquire your business to meet their business needs. They may be interested in entering new geographic markets, eliminating competition, improving their supply chain, or addressing weaknesses in other business areas. They acquire your business to supplement and enhance their current operations.

Financial buyers are investors seeking to acquire your business to generate a return on investment. These investors typically look to purchase your business, operate it for a period, and then “exit” their investment by selling your business for a profit.