Why you need an exit strategy
Why an exit strategy is important

If you're setting up a new business you'll have a clear vision of what you want to achieve from it. But to maximise the value you get from the business it's essential to think about how you'll leave it further down the line.

Carefully planning your exit from the business can help you to:

• mould your business into the ideal shape for your chosen exit option - maximising the value you get from it
• groom successors if they're coming from within the business - whether they're a family member or part of your management team
• exit at a time of your choosing, when the business is doing well and the market conditions are advantageous

Ideally, you should include an exit strategy in your start-up business plan. It can then be reviewed and revised whenever you work on your annual business plan and budget - and you can steer your business in the direction that your exit option demands.

If you manage an existing business and don't have an exit plan, you should now think about what your preferred exit option might be - and consider whether you could change the way you run your business to help you achieve it.

The way in which you exit can affect:

• the value you and other shareholders realise from the business
• whether you receive a cash deal, deferred or staged payments
• the future success of the business and its products or services
• whether you retain any involvement in or control of your business
• your tax liabilities