Do you have an exit plan in place for your small business? Is your exit plan formally written down or is it something that is just in your head?
Do you pull your exit plan out and review it more than once a year?
I believe that the majority of small businesses do not have a formal exit plan written down.
Here is why I believe not having an exit plan in place is very dangerous for a small business.
No Vision or Goal
The old saying goes "start with the end in mind", and it's very applicable to your small businesses. Having an exit plan written down that you can reference allows you to focus on a long-term goal.
As a business owner your actions day in and day out should support your exit; if they don't delegate those tasks and focus on what really matters in your business.
Most businesses don't have a formal exit plan written down because it never crosses their mind that they will have to exit the business someday.
An exit plan does NOT mean that you need to sell your business, in fact, there are many options that an exit plan could entail. A few popular options for exiting your business are to bring on an equity partner, go public, or pass it on to family.
Your exit plan will change dramatically over the life of your business. So you should start with an exit plan right from the beginning, no matter how simple it is.
Pull out your exit plan once or twice a year and read it. Does it still sound valid? Have things changed? If so, modify your exit plan and continue to review it a few times a year.
Turmoil if You Leave Unexpectedly
Some of the best business advice I have been given was to "run your business where you could walk out the door, get hit by a car and pass on, but your business would still thrive."
It's a sick thought, but the mentality behind it is very powerful. If your business can survive without you then you can exit, if not, you certainly can't.
If you left the businesses unexpectedly do you have a contingency plan in place? Would your departure from your business cause turmoil or would your business thrive?
If turmoil would ensue why is that? If you can identify the "why" in the last question then you have identified some things you need to work on.
Come up with a contingency plan for your departure from the business, as well as every other position on the organization chart.
You Won't Know When to Exit
One thing about not having an exit plan in place is that you won't know when to exit even if your opportunity is staring you in the face.
Let's say I'm in central Mass and decide I'm going to go hit a Sox game. I punch Fenway Park into my GPS and off I go. I have a plan and I will be given the exact exit to take. Let's not get carried away though into a good old Mass argument about whether the best route is through the Tunnel, Storrow, or god forbid, Route 9... I digress. In this driving example, there are no question marks.
I have a definitive plan and a route to get there. If I follow all of the steps and end up safely at Fenway then I have successfully completed my mission as planned.
The same should be true in your business; you should always have a definitive exit plan in place.
If you don't have an exit plan in place you are not going to have any clue when to exit the freeway. You will just keep driving along, aimlessly because you don't know where you are going.
Don't let this happen in your business! You don't want to be driving your business towards an undefined goal.
Having an exit plan makes things really clear, so when your exit is staring you in the face there is no hesitation; you know it's the right thing to do.
Do you have an exit plan in place for your small business?