Smart Exit Strategy Plans for Your Small Business
Thinking about taking a trip to the Siesta Beach in Florida? What’s tying you down? Whether you are the sole proprietor of your business or run it alongside your partner, it’s time to time to think about your exit strategy plan in Dallas, TX, so that you can take that long awaited trip with your family. Think about that beautiful sun shining while you doze on your towel and work on your tan. Doesn’t it sounding exciting?
As an investor, you need to think about all the possibilities that will help you sell your business in Dallas, TX. There are two questions that every business person asks themselves:
- What strategy will you take to get your years of investment out of your business?
- What amount will you get in the end?
After all, the beach trip will not pay for itself! By working on a strategy in advance, you get the assurity that when the time comes, you will have all the answers to your questions. Plus, it gives you control on you future business opportunities.
Below are a few exit strategy plans that you can consider for your business:
Liquidation
This is a straight close up of your business. Running a small business can be hard because you are the only person who is taking care of all the day to day interactions. If you are all out of products or services to sell, then liquidation must be next on your list. Make an inventory of all your business’s assets and calculate the sum total you are expecting to get. In some cases, people liquidate the business as a whole to someone else. It’s up to you which way you want to go.
Liquidation gives you the advantage to sell your business in Dallas, TX with simplicity. Depending on how high the assets go, you can wound up the business very quickly and profitably. However, the problem with liquidation is that you might not get much from the sale of assets such as inventory, equipment and land. All owner-client relationships are lost and second-hand machinery is sold at a much lower cost. Plus, if you have creditors, they have the first claim on the money from the sale.
There’s another way to liquidate the company too. You can take large pay checks, which might mean more tax but you will have immediate cash on hand. Though, it might reduce the price of the business but you will have more cash for personal use.
Initial Public Offering (IPO)
An IPO is something you do when you want to sell your business in Dallas, TX with all the fanfare. They are flashy and promise a great outcome. An IPO is the type of exit strategy plan in Dallas, TX, where you are left with a tiny portion of your company. When you make the public offering and put the stocks up for grabs, you can bring in as much amount you want. Though this plan is extremely profitable among any other plans, the process is very difficult. You need to make sure that there are no irregularities in your accounts and books. As the owner, if something goes wrong, you will be held liable. It may take a little time to get out your capital but eventually you will be paid.
Keeping it in the Family
This is perhaps one of the easiest exit strategy plans in Dallas, TX. It gives you the advantage of creating a safe cushion for your future generation. You might not get outright cash in your hands but the payout is still satisfying. You get to keep a hand in the business dealings and still pass it on to someone in your family who has similar interests. The plan might create a little difference of opinion in the dealings but it is nothing that can’t be discussed.
Acquisition
Acquisition is a difficult exit strategy plan in Dallas, TX because it is unpredictable. It has equal advantages and disadvantages. Your one chance at getting the best price for your business is negotiating with the acquirer company’s employee. You can convince them through statistical data that they will get a nice chunk of profit of they buy your business. Acquisition is all about choosing the right company:
- Are they the right match to your business’s overall values?
- Will they be able to expand with your business into the new market?
- Will they be able to co-exist?
Many companies self-destruct because either the owners or the employees are unable to get together. This is why you need to make yourself attractive in the eyes of the acquirer. Instead of trying to tip the balance of the scales, maintain an even playing field.
Try to get at least two acquisition proposals, so that you can choose the one that offers the best price and understands your business values.
Sell it on the Open Market
Similar to liquidation, this is an outright sell. If you are ready to retire, then it’s time to sell your business in Dallas, TX. You can advertise your business through various channels and offer a non-negotiable price. This ensures that only the interested parties will call. You can even set a room little for negotiations but be prepared, you might be disappointed with the end result.
Before you plan an exit strategy, you need to ask yourself what is that you hope to achieve with the sell. What are your personal goals? If you want to walk away with money in your pocket, then liquidation or selling it on the market is the best choice. However, if you are hoping to see your baby up and running even after its sale, you can go for the other plans. For some people a business represents one of their best achievements and seeing it torn apart can be painful. Therefore, before making a decision, think about it long and hard.
Planning to sell your business in Dallas, TX? Kirksey Business Brokers is a certified company that helps people plan the perfect exit strategy plan in Dallas, TX for small businesses. Get in touch with their intermediaries to bring on a qualified professional on your team, who will negotiate on your behalf. To know more about their services, call at 817-637-1508.