Planning ahead for the future of your business: succession and exit strategies

Are you ready? 

Before embarking on succession or exit planning, it’s important to take a step back and clearly define what you want to achieve, as well as assess whether the business is ready for transition.

Key questions to consider include:

• What are your personal objectives and preferred timescales for stepping back or exiting?
• Do you intend to fully exit, reduce your involvement, or remain in an advisory role?
• Is there a clear successor in place – internally, within the family, or externally?
• To what extent does the business rely on you personally, and what risks does that create?
• Have you considered how the transition may impact employees, customers and suppliers?
• Have you reviewed the structure of the business and the potential tax implications?
• Do you have trusted advisers in place to support you through the process?

Being clear on these points early can help minimise delays, uncertainty and missed opportunities later on.

Identifying the right succession route

Once you understand your objectives, the next step is to identify the most appropriate route for succession or exit. This depends on your goals, the business model, and who may be best placed to take ownership or leadership forward.

Common routes include:

• Management buyout (MBO)
• Family succession planning
• Sale to a third party
• Members’ voluntary liquidation (MVL)
• Employee ownership trust (EOT)
• Partial sale or phased exit to Private Equity

Each option carries its own commercial, legal and tax considerations, and choosing the right route can have a significant impact, and influence both value realisation and long-term continuity of the business.

Is the business ready for transition?

Succession and exit planning is not just about selecting the right route, it’s also about ensuring the business is in the best possible shape to support a smooth transition.

Important considerations include:

• Strengthening the leadership team and reducing reliance on the owner
• Ensuring robust financial reporting and effective performance tracking
• Reviewing contracts, customer concentration and supplier dependencies
• Identifying operational risks or inefficiencies
• Developing clear plans for key employees and retention
• Putting appropriate governance and decision-making structures in place

Taking these steps can help maximise business value, enhance buyer confidence, and minimise disruption during periods of change.

Planning the deal: value, structure and tax

Where an exit involves a sale or transfer of ownership, early planning is critical to understanding how value will be realised and how the transaction should be structured.

Key areas to review include:

• How the business will be valued and the factors that drives value
• The likely deal structure and terms
• Whether the exit will involve staged payments or earn-out provisions
• Available tax reliefs and planning opportunities
• How the proceeds will support your longer-term personal financial plans

Having clarity on these factors helps ensure you exit on the right terms and with fewer surprises.

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