Almost any “how to start a business” book will give advice on developing an exit strategy when building a business. This allows you to recover from a failed business as easily as possible.
For instance… a place to sell off left over inventory, leaving enough in your savings to get you through a few months of no income, etc.
One thing most entrepreneurs fail to build into the business plan is their exit strategy in the event the business actually succeeds.
So many times all the focus is put on building a successful business and often times the entrepreneur will build the company in such a way that it won’t be able to run without him. Maybe the business is built on the skills of the original owner or maybe he’s such a control freak that he fails to delegate things and never passes his knowledge on to other people.
This is what his life looks like:
In any event, the entrepreneur becomes a slave to his business. When planning your business keep a long term exit strategy in mind. Build the business in such a way that as it becomes more profitable you decrease your level of involvment.
- Train other’s to learn your skills
- Hire and delegate daily, mundane tasks
- Allow your employee’s to make decisions without your input
- Focus on expansion and growth
This is what your business should look like:
So while writing the plan for your next business, be sure to build in your exit strategies. Both for failure and success.
Neolex, The Mentat on June 9th, 2006 at 8:00 am
In other words… instead of becoming tactical as the business grows the entrepreneur should go strategic. Strategic mindsets further the business. Tactical makes sure it remains viable.