E mpowering I magination A pplying K nowledge E xploring I nnovations T omorrow S eizing O pportunities A ccelerating B usiness I nspiring I nnovations E mpowering I magination A pplying Knowledge Explore S eizing O pportunities A ccelerating B usiness I nspiring T omorrow E mpowering I magination A pplying K nowledge E xploring Innovation T omorrow S eizing O pportunities A ccelerating Business I nspiring T Monitoring and Exit Strategy

Monitoring & Exit Strategy Monitor  After sales and expense estimates have been projected, indicators need to be monitored to reveal areas of success and areas that need improvement.  Suggested time periods in the start-up year are:  3 months  6 months  12 months

Monitoring & Exit Strategy Categories to be Monitored  Finance  Supply Chain  Sales  Marketing Operations  Marketing and Customer Relations  Human Resources

Monitoring & Exit Strategy Compare Financials  Income statements  Balance sheets  Sales dollars  Net profits  Financial ratios  Cost of goods sold

Monitoring & Exit Strategy Comparison Tools  Internal and external sources  Product trends  Employee turnover  Target market analysis  Number of web hits

Monitoring & Exit Strategy After Evaluations are Complete  Make improvements like:  Change pricing strategies  Expand customer base  Find more cost-effective suppliers  Reduce spending  Set payroll goal costs

E mpowering I magination A pplying K nowledge E xploring I nnovations T omorrow S eizing O pportunities A ccelerating B usiness I nspiring I nnovations E mpowering I magination A pplying Knowledge Explore S eizing O pportunities A ccelerating B usiness I nspiring T omorrow E mpowering I magination A pplying K nowledge E xploring Innovation T omorrow S eizing O pportunities A ccelerating Business I nspiring T Exit Strategies

Monitoring &Exit Strategies  Exit strategies provide a method for entrepreneurs to liquidate their investments from a company and move onto the next project.

Monitoring & Exit Strategy Develop an Exit Plan  Seek professional advise  Separate personal identity from business  Staying with the company as an employee or consultant rarely works  Emotional conflicts  Find new project

Monitoring & Exit Strategy Four Possible Exit Methods:  Sell company  Release cash flow  Go public  Inject private investor money

Monitoring & Exit Strategy Sell the Company  Evaluate assets and cash potential  Business only worth what the buyer is willing to pay  Merge with other like companies  Sell to employees

Monitoring & Exit Strategy Sell the Company  When selling a profitable business consider the fact that the business was probably built on the skills of the original owner.  This is what his life looks like:

Monitoring & Exit Strategy

Sell the Company  Realistically, when planning your business keep a long term exit strategy in mind. Build the business in such a way that as it becomes more profitable you decrease your level of involvement.  This is what your business should look like:

Monitoring & Exit Strategy

Sell the Company  Train others to learn your skills  Hire and delegate daily, mundane tasks  Allow your employees to make decisions without your input  Focus on future goals

Monitoring & Exit Strategy Going Public  Initial public offering (IPO) on the stock market is used to raise additional money:  To finance growth  Repay outstanding debt  Fund future acquisitions  Provide mechanism for owner exit  Select board of directors

Monitoring & Exit Strategy Release Owner’s Cash Flow  Orderly withdrawal of owner’s investment  Stop reinvesting money in the company  Stop growing the business to increase cash flow to owner  Can leave firm unable to match competition  Owner retains control  May enable business transfer to family member

Monitoring & Exit Strategy Inject Private Investors Money  Money invested by private entity:  To finance growth  Repay outstanding debt  Fund future acquisitions  Provide mechanism for owner exit  Provide in-family transfer of company control

Monitoring & Exit Strategy  Writing a business plan involves looking at the entire business cycle from concept through monitoring and to the exit strategy.