Avionics News March 2012 - 58

series

BUSINESS BASICS
B Y G R E G L A S L O

Exit Strategy
ventually, the time comes when hanging a shingle becomes less attractive than simply hanging it up. Industries change, business economies change and, more importantly, people change. Case in point: millions of baby-boomer business owners are approaching age 60, setting the stage for some big transitions among small businesses. According to a survey last year by Family Business Magazine, more than one-third of business leaders plan to retire in the next five years, and two-thirds want to retire within the next decade. By those estimates, we should see something similar in our corner of the world. But, the decision to let go of the business with your name on the hangar door is complicated. Not only must you decide when the time is right to make the change, you also have to dispose of the company you built for decades. Each requires planning, operational savvy, financial management and a fair bit of soul-searching. And, if your business is your “other child,” none of it will be easy, even if the payoff is some hard-earned freedom. If you want a successful transition, letting go requires evaluating the goals of your business, shifting operations so you’re able to move on and deciding what to do after you walk away. While few entrepreneurs have fully considered their exit strategies, the simple act of doing
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How to Let Go of Your Business
so can give the business room to breathe and grow, whatever your personal future holds. Taking Time Out Eventually, you will call it quits, either voluntarily or not. Yet, whatever happens depends on your goals, or more precisely, the goals you used to run your shop. There are two grand generalizations. Each are well within your rights, but each presents a different outcome, according to Craig Aronoff, founder and chairman of The Family Business Consulting Group, professor emeritus at Kennesaw State University and co-author of the 22-volume Family Business Leadership Series, including Family Business Succession and Letting Go: Preparing Yourself to Relinquish Control of the Family Business. In the first, an owner feels, “Gosh, I built this business; I get to do anything I want with it.” As long as the owner is happy, there’s no reason to step down. In that context, if the business gets run into the ground, so be it; it’s the owner’s business. If it’s all about the owner, and he or she is upfront about this with everyone – employees, family members and customers – fine, Aronoff said. In most cases, the owner will keep the business afloat long enough that it outlasts him, even as both are projecting a downward arc. If the owner has taken enough money out of the business that he or she is financially secure, all the better, because there may not be much value left, except for some equipment, real estate and any remaining inventory. Inevitably, these businesses close.

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Avionics News March 2012

Table of Contents for the Digital Edition of Avionics News March 2012