Whether you’re in a movie theater, on a plane, or in an ordinary building, you’ll notice one thing in common, exit signs.
In fact, exit signs have been a long standard backed by regulations to ensure that every space will be safe. Why? Because, if anything happens within the space, there needs to be an adequate number of exits available to get to safety. You’ll notice there’s never just one exit sign, there are multiple exits. If there is a fire or other emergencies, they need to have multiple exits available for people to use.
Considering how important exits are to our common safety, why then, are most entrepreneurs and business owners operating without a clear exit plan?
Just like the exit signs, exit plans are not a matter of convenience, they are a matter of safety and common sense.
Establishing an exit plan, for the owner to eventually leave or sell the business, lends peace of mind and safety for the business owner. Entrepreneurship can be a risky proposition but your exit plan doesn’t have to be. Today we’ll be discussing what exit strategies involve and why it’s necessary for every business owner to have them.
Why an Exit Plan is Important For Every Business Owner:
Planning for tomorrow – Many business owners are so bogged down by the day to day supervision and management that goes with execution, it is difficult to focus beyond tomorrow.
For small operators in our space, it requires a certain size and scope of operation that is hard to achieve in even the largest markets to be able to afford a level of management that frees the owner to focus on strategic plans and take steps to put the business on a path of growth not previously experienced.
Alternatively, when there is too much focus on an exit plan or strategy in some relevant time frame, important operational decisions can be adversely influenced by the plan. Like with all things in business, it’s a balancing act!
Listening to the experts – In today’s world, most business advisors and brokers recommend having an exit plan from the very start of your business. While it may seem far fetched to plan so far out, dedicating time to decide how you’re going to sell or remove yourself from your business, is really the smartest plan in today’s ever-changing economy.
Providing a blueprint for success – If you were to get in your car without a map, how would you know where you were going? If you don’t know if you’re going to sell or phase out your business, you’ll never know when you get there.
Enhancing the value of your business – Exit plans don’t necessarily add more value to your business, however, having an exit plan will influence your decisions about the business. When you determine your desires for your exit, you’ll be able to guide your business decisions to your own predetermined and preferred conclusion.
Making strategic decisions – As mentioned above, decisions are what shapes the future value of your business. With no clear exit plan, it’s so easy for business owners to get caught up in their “job” rather than their role as a business owner. Your exit plan will keep your goals in view and will make your day-to-day decisions serve your endgame.
Staying flexible with the future – Like most things with your business, things are constantly changing. Of course, your initial exit plan will likely change, too. That’s okay! When you have an exit plan from the start, this provides guidance and benchmarks along the way. For instance, anything unexpected, such as a major life change, death in the family, or even a change in your passion, can influence your initial plan. It’s much easier to change your exit plan once you’ve created it, rather than start from the entire beginning.
Why an Exit Plan is Important For Every Business Owner In The Liquid Waste Industry:
The liquid waste industry is in its infancy of consolidation. This is great news because there is a large amount of private cash looking for a proper investment. Additionally, liquid waste company valuations currently tend to be on the high end.
One of the greater concerns we encounter with owners is culture compatibility. For both the buyer and seller, success is critical. According to the Harvard Business Review, 70% to 90% of mergers and acquisitions fail. The path to success is relatively simple: “people who focus more on giving than on taking in the interpersonal realm do better, in the end, than those who focus on maximizing their own position” – Adam Grant
American Allwastes steps into a seller’s operation with the intent of supporting and accelerating the vision important to both seller and buyer by providing growth capital, managerial oversight, transfer of valuable skills, and sharing valuable capabilities.
We are looking for established management teams that can be enhanced with support. Sometimes that may mean it is led by the owner who is looking to eventually exit, other times they’re looking for a growth partner. We participate in the succession and growth planning that might not be available to the seller without a partner like us.
Want to discuss your exit plan? Looking for an opportunity to sell or grow? Contact us today at https://www.allwastecorp.com/ or call us at (713) 783-3700.