Types of Exit

1. Succession - what to consider
2. Passing on to the next generation
3. Management buy out
4. Buy in management buy out - BIMBO
5. Sale on general market
6. Sale to someone you know
7. Franchise
8. Flotation
9. Venture capitalist
10. IPO Initial Public Offering
11. Fire/liquidation sale

Succession - what to consider

Not all exits are planned or voluntary. Sometimes a divorce, illness or even death can cause a very unexpected exit. Will your wife or husband or staff want or be able to run the business? The effect on the business can be devastating, staff morale can fall, the bank or investors can become nervous and even your customers may panic. This means that the value of your business will be less.

We can help with succession planning; it is not just a question of deciding how your assets are divided after you die. At its most basic, a succession plan is a documented road map for partners, heirs and successors to follow in the event of your death, disability or retirement. It allows you to plan well in advance how to address any issues when you have time to work out the answers - it's important not to leave it too late in fact we suggest you launch your business with the plan in place.

Passing on to the next generation

Most owners still in their prime would rather not think about handing over the family business to the next generation - at least not until they're ready to retire. By then, though, it may be too late to come up with the kinds of tax-saving strategies that could save you and your heirs money. In addition, by planning early you can help the next generation develop the skills they will need to run the business.

If you want your family to inherit we can help by providing objective advice about the issues that you will face and developing a plan with you with agreed goals and timescales.

Management buy out

For businesses with a loyal staff who share your values a management buy out can be the best answer. The reputation of your business should be in safe hands and your customers will continue to get the service you expect.

However staff need time to think about a management buy out and time to prepare financially, in terms of developing their skills to take over and psychologically to handle the issues of becoming the boss.

We can help address the tax and financial issues and work with you and the staff to develop their skills and help you gradually to withdraw from the business. The end result should be a good amount of money for the business owner with a business which can be viable in the future for the staff.

Management buy in

A management buyin (MBI) occurs when a manager or a management team from outside the company raises the necessary finance, buys it, and becomes the company's new management. A management buy-in team often competes with other purchasers in the search for a suitable business. Usually, the team will be led by a manager with significant experience at managing director level.

The difference to a management buy-out is in the position of the purchaser: in the case of a buy-out, they are already working for the company. In the case of a buy-in, however, the manager or management team is from another source.

Buy in management buy out - BIMBO

A buy-in management buyout is a combination of a management buy-in and a management buyout. In the case of a buy-in management buyout, the team that buyout the company are a combination of existing managers and individuals from outside the company who will join the management team following the buyout.

Sale on general market

This now often involves listing on the internet to try to sell to anyone who is interested

Sale to someone you know

A friend or acquaintance or suppliers, competitors or customers are all potential purchasers of your business.

Franchising

Franchising may be a way for some businesses to generate cash. When people speak of franchises, they are usually referring to business format franchises. Such a franchise is essentially a business clone.

The franchisor has developed a system for reproducing his business (often right down to the last detail). When you buy a franchise, you rent the franchisor's trademark and method of doing business. The method of doing business involves a standardized approach to delivering a product or service.

Flotation

Floating on the stock market can get capital into a business and provide a means of getting the value out of a business but it is expensive and can be risky and once done means that the company has to meet the expectations of shareholders and the city.

Venture capitalist

A venture capitalist will want a good return and is normally interested in businesses that will provide good growth. However they can provide input, for example, technical expertise to meet a skill shortage in the business in addition to cash.

IPO Initial Public Offering

An Initial Public Offering (IPO) - is the first sale of stock by a private company to the public. IPOs are often issued by smaller, younger companies seeking capital to expand, but can also be done by large privately-owned companies looking to become publicly traded.

Most IPOs are of companies going through a transitory growth period, and they are therefore subject to additional uncertainty regarding their future value.

Fire/liquidation sale

A forced sale when there is no alternative.