How to Maximise the Value of your Business – Part 6 – Timing Your Exit

An article by Peter Watson, Prism Corporate Broking

The secret of comedy is timing – or so they say, and timing is also a key factor in maximising value upon exit.
It was once mentioned to me that owner-managers tend to know when to exit. Experience shows that for many this couldn’t be further from the truth.

We can probably all think of instances where it is clear that a friend has gone on too long, or indeed where someone has sold their business and left an enormous hole in their life.  But how do you get it right?

We see an optimal exit as a confluence of three forms of timing:

Firstly you need to assess PERSONAL timing.  When is the right time for you? Hard cut-offs are often difficult to cope with, so ideally you will be able to phase your departure.

Then there is BUSINESS Timing. Is this the right stage in the business cycle?  Are you about to embark on any major initiatives, e.g. launching new products?  If so, what impact will this have?

Finally consider MARKET timing. What is happening in terms of mergers & acquisitions in your sector? Is there an active consolidator? What are they looking for?

Very few people achieve all three, but if at least two of these are favourable, then you can still achieve a good exit.