Exit/Succession Planning is not something that’s usually at the forefront of most SMEs minds; they’re usually so busy running their business on a daily basis that until either something unexpected or unforeseen happens, or until they are actually ready to place their business on the market ‚Äì it’s an afterthought.
Startling statistics reveal an impending mass exodus of business owners from their businesses over the next 10 years, as the predominant age group of current business owners move into retirement.
At a macro level this ‘wave of exits’ could have some serious impacts on the Australian economy whose business landscape is dominated by SMEs; at a micro level this phenomenon could impact negatively on many business owners.
In preparation for this significant social and economic event and to mitigate the negative impact of this trend, I recommend that business owners work with experts (such as Exit Alliance) to plan effectively and comprehensively for exit. This type of specialist advice covers a range of streams from taxation, insurance, legal, human resources, psychology and more.
There is increasing concern that the flood of businesses to market will drive down the pressure on price. Not only that, but also a lack of exit planning means that there is genuine concern about the capacity of SMEs to extract value from the sale.
According to PwC analysis, more than 1.4 million owners, employing 7.9 million people and contributing $500 million to GDP, will retire in the next decade. And what will be the greater consequences to the broader Australian economy?
These statistics combined with a glaring ‘gap’ in the market, where no cohesive, structured, comprehensive approach to help SMEs plan and prepare for exit, led to the formation of Exit Alliance.
The Hunter region’s business landscape is dominated by SMEs and right now is a critical time with imminent change coming over next five to ten years. I am passionate about assisting business owners to transition change and secure the best possible outcome when it’s time to exit their business; this means putting things in place now, not when the business actually goes to market.
It’s in everyone’s best interests to ensure retiring or exiting business owners secure the optimum result in line with their goals and expectations.