Exit stage left.

Statistics show that 1 million small business owners will be exiting in the next decade and the majority of them are relying on this exit to fund their retirement. Yet statistics also show that 55% of all business exits do not provide this safety net and are due to ill health, liquidation, bankruptcy, owners simply walking away and the ultimate exit, death. So your exit strategy or succession plan had better be well thought out if you want to enjoy the fruits of your labour.

Owners usually go into business for many reasons but freedom (own boss), flexibility (work hours), income improvement (sometimes lifestyle makes way for the dollar) and equity build are the big ones, with the last being the most difficult.

For many business owners the discussion on exit strategies, rates up there, with what their first partner got in the divorce and the regular prostrate check up. It’s that, way in the future, why worry now, I’m sure business will pick, it’ll never happen to me mentality that gets so many people into trouble but before they know it, the time has arrived and they are not ready to go. Not ready because there isn’t enough money in the bank, no one is interested in buying and they have nothing to sell.

So that 55% statistic is telling and daunting at the same time. A good exit strategy is difficult to expedite and you certainly don’t want to rely on the ultimate exit as the solution. Keep working till you drop doesn’t really have the same ring as retiring to an island. I often joke with business people that dying is not an exit strategy but a recent University College of London study in the Journal of Epidemiology stated that bureaucrats who admitted being bored at work were 2.5 times as likely to be dead of cardiovascular disease within two decades. Younger workers who are bored were also more likely to die younger than those not bored. Hmmm, so your employees could end up with the same ultimate exit strategy as you unless they step outside that boring comfort zone, for their own good.

Okay let’s decide not to die before our time from boredom or overwork and outlive work to choose some better exit options. In travel especially, small business owners are often the rainmaker in their business and it is difficult for them to picture their exit as a lot of business would walk out the door the minute they did. Look at passing on (not that way) the business to employees and maybe earning a continuous income stream as that part time mentor consultant. Look at bringing in a younger partner with the objective of selling it all to them at a later date. Look at family options as another way to escape and still have some influence. Look at selling to your competitors as they have probably been jealous of your success for a long time. Look to advertise the business for sale and have a “this business is really really good and I’ll stay on for a while” clause to engender trust in the sale. Look to sell the assets and physically close the business. Look to grow quickly in the last years via acquisition and float the business and take the share money.

Look to as many options as possible, get rid of the boredom, stay healthy, and keep in touch with the family because the alternatives in the 55% statistic do not provide the answer, least of all the ultimate one.