By Analytix Editorial Team
For a business to be successful, it should strive towards becoming a high-economic value venture. One way to ensure this is by having an exit strategy in place that established the business as a viable acquisition for other companies or for a smooth transition from one business structure to another. An exit strategy is not always about selling a business to reap a profit. It can also serve as an indicator as to how successful the business has become.
How Is An Exit Strategy Linked With Business Continuity?
Business continuity planning is an ongoing task. Events that challenge continuity include employees leaving without transferring information, key resources terminating services, systems becoming corrupted, excessive downtime during critical periods, and natural calamities.
How prepared a business is during times of crises is an important indicator of its success. Having a business continuity plan in place means the business is well-prepared to handle whatever challenges come its way, without significant loss in revenue or business prospects.
Business continuity ties in with an exit strategy because most often a business that has an exit strategy will work diligently towards maintaining solid operations and a focus on return on investment.
This is also why an exit strategy requires development from the inception of the business. Following are some key features that can result from careful planning and which point towards a successful business:
Sound Financial Health: A business with an exit strategy recognizes the necessity of strong accounting practices. Efficient and timely filing, management of tax obligations, and optimization of deductions are all indicators of well-run accounting processes. The existence of accurate monthly financial figures, a working budget, and well thought out projections or forecasts are all indicators of a business that is steadily managing growth.
Careful Planning Ensures Success at All Levels: Planning, goal-setting, and adherence to plans leads a business to success. This includes diligent tracking of business transactions, in turn leading to accuracy in bookkeeping and accounting, eventually ensuring sound financial health.
Communicates Higher Levels of Preparedness: Having an exit strategy in place indicates that business continuity measures, including crisis preparedness are in place. A business that is well-prepared for crises invests in backup measures for both infrastructure and manpower resources, as well as ensures diligence in goal-setting. However, this investment need not come at a high cost or budget extensions. Outsourcing can make expertise and infrastructure accessible to even startups on a budget.
A business with an exit strategy in place pursues high-growth at a faster pace through ensuring streamlined everyday operations and investing time in the pursuit of new business development goals. Businesses that possess a foundation of both, streamlined daily operations and good prospects of growth, have a higher chance of reaching high economic values faster.
At Analytix, we have extensive experience with helping small to mid-sized businesses in all aspects of business management, including preparing an exit strategy. For more information on how we can assist you, call us at 781-503-9004 or email us at [email protected].