Looking back is a key component of your exit plan
Looking back is a key component of your exit plan
By Alex Dodgshon

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Looking back is a key component of your exit plan

TAGS:  Business Exit Strategies, Exit Planning, Scaleable Business, Second Tier Management, Value Builder Methodology

This is the time of year when we’re bombarded with phrases designed to improve our lives and boost our businesses – planning for success, the perfect exit strategy, organisation and optimisation, changing habits and becoming financially healthier. These are all themes we’ve come across in recent weeks, which are designed to inspire, but can easily leave you feeling overwhelmed. This may be especially true if you have one objective in mind – planning to exit your business.

It’s hard to know where to start with planning to sell your business. Looking back at recent performance is a great place to begin moving forward. Reflection can give you the energy, impetus and momentum to achieve the kind of business exit you desire. In this blog post we’ll highlight three important areas to focus on.

The value of reflection in strategic planning

“You can’t see the label when you’re inside the jar”

We don’t know who coined this quote, but it’s widely used in leadership and coaching circles, and for us it perfectly sums up the real value of reflection. Stepping outside of your business and reflecting on challenges and achievements is a positive move, not a backwards step.

Looking back is something we all do without thinking. A driver looks in their mirrors before moving off because it keeps them, and others, safe. A good manager encourages their team to learn from their mistakes and view setbacks as opportunities, not failures. Sifting through old photos brings back memories and helps us realise what’s important in life. Looking back is a learning activity that guides us to move forward.

The ability to reflect is especially important in 2025 as rises in minimum wage and employer’s NICs come into effect this April. Organisations are looking to identify efficiencies and become leaner in an effort to reduce financial pressures. Some companies will be planning big strategic changes to the way they operate as a result of reflective practice.

Where to focus your reflection

To structure the process of looking back, we recommend reviewing the three areas of metrics, people and customers. Keep your exit plan in mind as you go, and ask yourself the question: ‘How will this help me increase the value of my business when I come to sell?’.

We know this can be a daunting task. Call us on 01606 535020 if you need a helping hand.

1. Key business metrics and trends

How did you perform against your financial goals last year? Identifying the areas in which you have performed well and not so well will demonstrate where you can improve. Analyse your business accounts to highlight your main revenue streams and biggest profit margins. Which are your most reliable income streams? Which product or service lines are unprofitable? In which areas did you generate most turnover and spend most last year?

As you define your exit plan, focus on what you do well and try and reduce or eliminate unprofitable activities. Look for both upward and downward trends that will inform your future strategy.

2. People

Are you getting the most out of your employees? Do you measure individual or team productivity? Measuring profit per employee is common in the service sector but perhaps a little more difficult for a non-target based business. If measuring profit per employee is not possible, use other available insights.

Ask your employees for feedback. Measuring employee satisfaction and engagement will tell you how committed your people are and how they feel about working in your organisation. Low satisfaction and/or engagement could jeopardise any business sale that involves employees . How can you reassure a prospective buyer that your team is committed to their work both now and during any future tenure?

Action planning in this area is all about creating the right culture and mindset for a business sale. A healthy, skilled workforce will be more productive than a stretched and stressed one, and a productive workforce makes for a more profitable and attractive business proposition.

3. Customers

Do you profile your customers? Do you identify repeat/returning customers? Which customers have you lost, and why did they leave? Which customers generate the most profit? What services are they taking and which products or services do they want more of? Customers that take out additional services are the customers you want to attract more of in your future plan. This is the activity that drives profits and adds value to your bottom line.

Customer satisfaction is another important measure to review. Keeping existing customers happy is a must. Creating the wow factor to attract new customers in the areas you want is also crucial if growing your customer base will form part of your exit plan.

Time for some extra reflection?

Other areas you might like to reflect on as you look back over past performance include:

  • Your personal strengths, weaknesses and achievements as a leader
  • Supplier management and service levels
  • Market conditions and external factors, e.g. competitor performance.

Preparing to sell your business is an olympic task, and looking back is a great place to start moving forward with your plans. The process of stopping to reflect will create the foundations of your exit strategy and be time well spent. The outcomes will reveal where to invest and focus your efforts in order to get the best price when you sell. It will also guide you in making the key decisions to get you to where you want to be.

If you plan to exit your business in 2025 and you don’t want to go it alone. Book a discovery call to find out how we can support reflective practice to help you improve in areas that will add most value to your business and increase your eventual profit from its sale.

Additional reading

Free download: Endgame – a guide to creating a clear roadmap for your entrepreneurial journey.

Blog: Strong foundations equal strong exit

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