Most entrepreneurs are so focused on getting their new business off the ground that an exit strategy is the furthest thing from their mind.  But, it should be the first thing on their minds.

An exit strategy is a plan to leave your business with what you want to leave it with.  It is the end to the means.  You exit strategy guides your decision making throughout your entire venture.   As you go through the process of starting or growing your business, the plans for how you will exit your business will be a huge help in making decisions.  Your exit strategy needs to be clear because it will dictate how you operate your business.  Your exit strategy has implications on your business structure, your assets, and your employees.

For example, if you are a plumber wanting to work until you retire, then just walk away; you don’t want to accumulate a large inventory of equipment that you will have to get rid of at retirement time.  You would instead rent or lease some of the tools and equipment you need for a job.  It may seem more expensive at the time but, in the long run will be worth it.

If you are planning to sell your business, you have to work on it being a business someone would buy every step of the way.  You wouldn’t want to name your business “Susie’s Fashion” because the new owner might not be named Susie.

You use your exit strategy to determine your business name, structure, accounting system, marketing plans, and your basic day-to-day operations.  By deciding how you plan on exiting from the beginning, you can make the decision making process easier throughout your involvement.  And, actually walk away the way you want to.

Planning your exit strategy is about making a proactive series of decisions instead of reacting to unexpected events.  Planning your exit strategy in advance gives you time to do it right and maximize your returns.
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