Devising an exit plan requires three broad steps: gathering data; quantifying you resources, and assessing exit options. Many owners want to know how long this process will take. The answer is as unique and variable as your business. It depends on how prepared your business was at the outset, and how much you’re willing to do to get it ready.
A few general guidelines can help you estimate how long it will take to sell your business, and how long it will take to get a viable exit plan in place. If your initial assessment reveals that your business is not well-positioned for a sale, the right advisor can help you get ready as quickly as possible. Here’s what you need to know about navigating the exit planning process.
How Long it Takes to Devise an Exit Plan
Drawing up the initial exit plan usually takes just a month or two. To get through the process quickly, you need to have ready access to the right data and a clear understanding of your goals. Your advisory team needs to gather the right professionals and help them dig deeply into the details. If you don’t have an advisory team, drawing up your exit plan can take several months.
As part of developing your exit plan, it’s important to look at your unchecked assumptions. For example, you might think your kids will one day take ownership even if they have no interest. The right advisor can help you tackle these unforeseen concerns and highlight any assumptions you have not addressed. Uncertainty is the enemy of a prompt and lucrative exit.
Once you have an exit plan in place, you’ll have a clear idea of areas that might drive value. Working with your exit planning advisor and advisory team, you’ll work to implement a strategy that drives value. For some businesses, this is a quick and easy process. For businesses with serious issues, however, increasing value can take months—and sometimes even years.
Implementing and Executing the Exit Plan
Implementing the exit plan is often the most time-consuming portion of the process. Once you know what you need to do to build value and find the right buyer, it can take time. But with a well-worded and specific exit plan, the process can begin right away—especially if you have already done a good job preparing your business for your exit.
Different Timelines for Different Exits
The specific challenges of your individual business are ultimately what will dictate the timeline for an exit. Some factors that can affect how long an exit takes include:
No matter the circumstances you find yourself in, a skilled team of experts can expedite the sale timeline and maximize value. So get to work early, and retain an expert you can trust.