How Can A CEO Grow The Business And Plan The Exit At The Same Time? / by Kerri
At first glance, it may appear to be a futile contradiction for a CEO to try to grow the business and plan the exit at the same time. But when you look at them side by side, you’ll see that growing the business is an essential early phase of any exit plan. The mistake is trying to look at them as sequential projects instead of concurrent projects. The requirements of one will guide the decisions of the other and vice a versa.
- By you increasing revenues – a benefit to potential buyers – so growth itself becomes a growing the business saleable asset
- Increased revenue from growth is easy to measure and monetize when the business is being valued for a potential sale.
- When decisions are made that lead to growth, immediate goals are met. When those same decisions are aligned with the long-term goal of how the owner will exit the business, those decisions have greater strategic value.
- Test every decision – When the long-term goal of the owner’s exit is known throughout the leadership team, every decision can be tested against these long-term criteria before implementation.
- There are many options to consider when CEOs want to grow their business. The options they select have a direct impact on their exit strategy and timeline. And if the exit plan is in place, all options for growth can be sorted to align business growth with the CEO’s exit plan. Here are just a few basic options to use individually or in combination:
- Increase sales prices
- Increase new sales
- Increase volume of sales/customer
- Increase add on sales
- Increase life of each customer
- Open new markets
- Open new channels
- Increase capacity (sales, marketing, customer support, production, facilities)
- Reduce costs
- Reduce overhead
The forethought and documented strategic planning you invest to grow the business develops depth within the entire management team. That depth in leadership as well as the resulting measurable growth increase, adds value to the business that is very attractive to buyers.