How Do You Know When It's Time to Exit Your Business?
Before answering this question, let’s revisit the definition of a business.
A business is a commercial entity that operates and generates profit even when the OWNER is not present.
The key phrase in this definition is "without the owner present."
Your business is a separate entity from you. A legal entity. The responsibility of your business is to continue operating smoothly and produce the cash flow you desire, even if you are not there. This definition is easy, but its implementation is a challenging task.
So, how do you know when it’s time to exit your business as a SME owner?
Here are some indicators:
If you observe or find yourself frequently in the following situations, it is time to start planning your exit:
- Your business's annual net revenue is over USD 2 million
- You are working a minimum of 6 days a week, for at least 10 hours a day
- You are personally handling all payments and collections for your company
- Your employees approach you with every issue without filtering, expecting you to solve their problems instead of trying to find solutions themselves
- You are making consecutive wrong and cash-inefficient decisions related to your business
- You are battling illnesses, including depression and various metabolic diseases, due to the workload, and delaying treatments/surgeries
- Your business struggles to make ends meet every year, and due to business blindness, you can no longer see other options
- You feel that you are the biggest obstacle to your business’s sales and profitability growth
- Your decision-making processes are slowing down day by day, and you are losing momentum
- You feel inadequate in finding and building the solutions your target audience needs
If you are experiencing these situations, it is time to start planning your exit and creating the structure that will allow your business to continue growing after you leave.
Always remember:
Your business exists to operate smoothly and generate the desired profit and cash flow even without you. As a business owner, your biggest responsibility in the big picture is to ensure your business becomes a separate legal entity that can continue independently, generating passive income for you.
There is a way.
The path to exiting your business with a full pocket begins with making the right and fast decisions for it today.
We are here to help you exit your business successfully with a full pocket.
Scale Your SME and Exit!
Note: There are some differences between exiting your business and exiting an industry. To address these differences in detail, we’ve dedicated a blog post on exiting an industry, which we will cover in our next blog. Please be sure to read it as well.