55% of all business exits are as a result of failure ! - Succession Plus

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55% of all business exits are as a result of failure !

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55% of all business exits are as a result of failure !

By , March 31, 2010

55 % of all business exits are due to death, disability, bankruptcy, liquidation or simply owners walking away and closing the doors.

To avoid this type of exit a business exit and succession plan is a vital part of business management. Business owners typical go into business with 3 key outcomes; increased freedom & flexibility, improved income and to build equity. Whilst the first two are generally possible the third outcome to build equity or wealth is not without a valid strategy.

There are many and varied exit strategies available to SME’s though with varied complexity, costs and risks:

Recent research, and our work with clients over the last 6 years, has shown a significant increase in the adoption of Employee Share Plans as a valid strategy with a substantial side benefit of attracting and retaining key employees within the business.

Approx 440,000 employees ( 5 % of the workforce ) now participate in these programs and the value of employee held shares or options exceeds $10billion. A recent study of the top 350 listed companies showed that 89.4 % had some type of plan in place compared to only 3 % of private companies.

Craig West

Craig West

Managing Director | Succession Plus

Craig West is a strategic accountant who has over 20 years’ experience advising business owners. His background as a CPA in public practice, provided invaluable experience in the key issues of concern to business owners. Following 6 years of study to gain two masters degrees, Craig focused on Capital Gains Tax (CGT) for business sales advising on strategic management of tax issues. This experience formed a very strong view that business owners (and often their advisers) were unprepared and unaware of the steps required to prepare a business for exit.

Craig now acts as a strategic mentor for mid-market business owners and has written four critically acclaimed books on employee incentives, succession planning, asset protection and exit strategies. Craig has conducted numerous seminars and keynote presentations throughout Australia & internationally, including adviser education programs for the Institute of Chartered Accountants and CPA Australia.