By definition, an exit strategy is a plan for leaving one’s current situation – in this case, your limo business. But if you wrote your most recent exit strategy back when you wrote your business plan, there’s a good chance it’s no longer relevant to your current situation.
Between shifting business cycles, new regulations, and our own evolving personal lives, the only constant in a business owner’s world is change. Without an updated exit plan, business owners may be missing out on opportunities to prepare their companies for the most likely sale scenario. Whether you hope to cash out in 20 months or 20 years, a current strategy helps ensure you achieve your goals when you do put your limousine business for sale.
1. Business value has changed
Maybe the economy has taken a toll. Maybe the services you provide today are different than when you started. Maybe you’ve expanded significantly or merged with a competing chauffeur business. Because value is based on what a qualified buyer will pay for buying a limo business in today’s market, the valuation of a limo business is never constant. If changes have occurred that have impacted your limo business profits or performance, you may need to employ different tactics to reach your exit goals.
2. Your successor has changed
All too often, business owners assume they’ll be able to one day hand their company over to a family member or business partner, only to discover later down the road that their intended successor is no longer able or willing to fill their shoes. If unexpected circumstances require you to exit the market sooner than anticipated, you don’t want to settle for a rock-bottom price because you haven’t prepped your company with an outside buyer in mind. People change. Businesses change. If your exit strategy hinges on the choices of someone else, it’s essential to regularly update your plan with their evolving goals in mind.
3. Your personal situation has changed
Chances are your life today is different than when you started your limo business. Do you have kids – or grandkids? Did you get married – or divorced? Maybe you’ve developed new interests and hobbies that are beginning to take precedence over your passion for your business. On the other hand, maybe you’ve been so successful that you’re ready to expand into new markets through the purchase of another limo service. Your exit strategy should reflect your life changes.
4. Your timeline has changed
The closer you get to your planned departure, the more frequently you should be revisiting your exit strategy. Depending on your present situation, you may determine that it’s necessary to adjust your goals, delay your exit, or put your limo company for sale even sooner. If things appear to be on track, you’ll need to switch your planning mode from the long term to the short term, focusing less on broad objectives and more on timely tasks like organizing financials and firming up client contracts.
Whatever your circumstances, a current exit strategy helps assure that when you do leave the market, you do so within your own timeframe and on your own terms.