Exit Strategy Definition

An exit strategy is not a one-size-fits-all approach. It involves careful consideration of your goals, whether that’s maximizing your sale price, finding the right buyer who aligns with your company’s values, or ensuring the continued success of your employees and customers. By thinking ahead and developing a tailored plan, you can avoid last-minute decisions and position your business for an exit that meets your personal and financial objectives.

Why Should a Business Have an Exit Strategy?

There will come a time when you want to move on from your business. This can be for any number of reasons. You may want to pursue other opportunities, diversify your holdings, move on for health reasons, or maybe you need the cash. It could be that you’re ready to retire. Whatever reason you have, planning your business exit benefits you, so the sale can progress more smoothly when the time is right.

What Does Business Exit Planning Entail?

For a successful business exit, plan and have (or find an advisor that has) expertise in these areas:

• Exit strategy development
• Business valuation
• Tax planning
• Legal documentation
• Negotiation

The specifics of these points will be different for each business, but they offer a general roadmap. Many of the actions under these headings are indeed part of your current business operations. However, you may be wondering how you can fit additional planning, research, valuation, and other preparations into your already busy schedule. This is where the expertise and support from an experienced business exit consultant can help you. In addition to facilitating much of the planning, consultants can also connect you with pre-vetted buyers. These are qualified investors to whom your consultant can market and sell your business. 

Let’s review how working with an experienced business exit consultant can help you plan your exit on your timeline.

How Do I Plan Ahead for My Business Exit?

Find an Experienced Advisor to Manage the Process

Putting together an exit strategy requires a lot of legal, financial, and operational planning. These are best managed by a trustworthy, supportive and experienced business exit consultant. The process requires discretion and foresight, including:

• Protecting Confidentiality

Exit confidentiality is vital to protect business value. Employees, customers, and suppliers can be upset by premature disclosure. Expert business exit consultants discreetly market companies and protect your privacy.

• Market Timing and Valuation

Industry cycles, economic conditions, and company performance all influence optimal exit timing. An experienced business exit consultant understands these elements and helps set realistic expectations and identify the best window for your exit.

Longer-term strategies (3–5 years) allow you to continue building a business that can attract premium buyers. As you follow best business practices, you’ll do much of this naturally. Your goal will continue to be creating a desirable product/service and delighting your customers.

• Due Diligence

The due diligence process typically reviews financial statements, contracts, employee records, customer data, and operational procedures. Preparing all of these (and ideally building best practices for these into your standard operating procedures) saves time and maintains momentum during negotiations.

• Customizing Your Exit

Your professional and personal goals should guide your exit strategy. Consider factors like:

• Post-exit involvement: Do you want to continue in your current role, take on a different one, or leave altogether?
• Does legacy preservation matter to you in terms of who runs your business and how they manage it after you sell?
• Employee protection: perhaps you want to stipulate certain points to keep employees on after you sell
• Tax implications
• Family considerations

• Post-Exit Considerations

 A successful exit plan also addresses what happens after the sale. Consider:

• Transition period requirements
• Non-compete agreements
• Employee retention
• Customer relationships
• Personal financial planning

An experienced business exit consultant supports you even after the sale, ensuring post-sale actions are completed.

It’s okay if you don’t have a clear picture of all of these points right now. You can keep them in mind as a guide to your exit when the time is right. Your business exit consultant will help clarify every aspect of your exit strategy so you know what to expect and work together towards your goal: a successful sale.

The Ultimate Goal: Finding the Right Buyer

A business exit consultant can connect you to highly qualified investors who want to buy your business. Professional business exit consultants, such as National Industry Network, maintain relationships with multiple buyer types and understand these buyers’ specific requirements and evaluation criteria. You will benefit from our well-developed buyer understanding that includes:

• Established relationships with private equity groups and strategic buyers that lead to competitive offers
• Deep understanding of buyer preferences that streamlines the matching process and increases close rates
• Negotiating leverage that creates multiple buyer interest

Professional Exit Planning Helps You Sell When You are Ready

Your business exit strategy should reflect your unique situation. The most successful exits result from careful planning, professional execution, and maintaining strong business performance. Although exiting can seem complicated, experienced guidance simplifies the process. 

National Industry Network, America’s premier business exit consultancy, helps shape exit strategies aligned with your goals, timeline, and desired legacy. With over 20 years of experience and a network of over 10,000 high-net-worth and institutional buyers, National Industry Network offers a trusted path to a successful sale. We take the time to understand your goals and collaborate with you to develop an exit strategy specific to your business, regardless of your timeline. 

Request your free consultation when you are ready to start planning your exit.. There is no financial risk. With no upfront fees, we only succeed when you do.

FAQ

1) What is an exit strategy in business?

An exit strategy in business is a plan for business owners to sell, transfer, or close their company to realize their investment and transition out.

2) How long does a typical business exit process take?

The active sales process typically takes 3–12 months, depending on factors like due diligence and financing. Comprehensive exit planning should begin as soon as possible. Fast-tracked exits are possible but may impact value optimization. Generally, businesses with revenues over $5 million require more extensive due diligence, which can extend timelines. 

3) When is the best time to start planning my exit strategy?

Ideally, plan well before you intend to sell. Even if you don’t plan to exit for several years, planning ahead gives you time to make strategic decisions that enhance business value, strengthen operations, and create more attractive options for potential buyers. Early planning also positions you to take advantage of favorable market conditions when they arise.

4) How can I maintain confidentiality during the exit process?

Professional advisors have established protocols to market your business while protecting sensitive information and maintaining normal business operations. National Industry Network will protect your confidentiality throughout the exit.