It is sometimes hard to have to think what your exit strategy should be in a business, especially if you are just starting out but in all good business plans it pays to know how you are planning leaving – either eventually by choice by selling off your shares of equity in the business or by necessity.
Part of a good exit strategy is to plan on how much do you want to retire on if you sell the business? The other way to look at it is, if my business looks like it is going under, how can I gracefully close the doors without screwing up my credit rating so I can open up another business later on?
The best way to keep on top of things is to have a place where you can contact all your creditors if you need to renegotiate contracts and payments. If you need to order product to continue to deal with a distributor, make sure you give the appropriate amount of notice time wise.
Back in the day when I was selling comic books through my comic book delivery service, Comic Cats, I saw that customers were starting to become delinquent with their payments to me. My profits at the time had dropped and I felt like I was the customer and my distributor was the wholesaler because things had gotten so expensive. I gave my two months notice with Diamond comics. Since I had to order comics two months in advance, I notified my customers who were subscribers, that I wouldn’t be taking any more orders but I would complete their orders for the next two months.
Things worked out well and if I wanted to open a comic book shop again, my credit and reputation with them is (hopefully) intact. Remember that when you are leaving a business that you want to be able to recross any bridges that were built and it is hard to do if you have burnt them behind you!
Kim Greenblatt
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Tags: exit strategy, Kim Greenblatt, lose money, make money, profitable, retire, selling the business