If you’ve owned your electrical services business for any length of time, you’ve likely given thought to how or why you might eventually shut it down, sell the company, or perhaps pass it along to a family member. Having an exit strategy is a smart business decision even if you feel like you could run the company for the rest of your life. After all, circumstances change and the future is unpredictable, so you may want to power down your electrical business at some point.
The mistake too many business owners make is not planning ahead effectively for that possibility, and therefore not recognizing and exploiting the best time to make their move. Whether that means they miss a golden opportunity or end up having to settle for a less profitable exit because they’re in a rush, it’s a sad situation.
The tips to follow will help you recognize the signs that you may want to seriously consider selling your business or closing it down. With that information in your back pocket, you can rest assured that life won’t sneak up on you the same way.
You don’t care like you used to
When you first started out as a business owner, it was probably exciting and even fun. If you’re like most electrical service business owners, you started out on your own because you recognized the potential to earn more from your skills working for yourself than for someone else. And, if you’ve stuck with it for any length of time, that was probably true.
But, you’ve no doubt also realized there’s a lot more to running an electrical business than knowing your stuff as an electrician. Owning a small business carries a lot of responsibilities that go beyond doing a good job for your customers. And, maybe you’ve found that part just isn’t any fun anymore.
Or, maybe it’s the electrical work itself that’s no longer appealing to you. Maybe you’re itching to try something completely new, or you’re ready to retire. Whatever the reason, if you’re just not feeling it anymore, it’s quite possible your lack of interest is coming across in your work. Even if that’s not the case, there’s no reason to prolong the situation unnecessarily and make yourself miserable.
Circumstances are forcing your hand
A major injury or illness — your own or a family member’s — may make it difficult or impossible for you to work like you used to. Or, maybe you’re pulling up stakes and moving across the country to support your spouse’s career.
It could be the birth of a child, a marriage or divorce, or any of a thousand other positive or negative circumstances that arise. Whatever it is, though, it’s making change necessary and you can no longer run the electrical business.
A great offer comes out of the blue
Maybe you weren’t even thinking about selling the business, but out of the blue you get a call from one of your big competitors in the next city over. They’re looking to expand into your area and want to buy you out. And, their offer is way too good to refuse.
The business isn’t doing well
The electrical services industry is always going to have ups and downs, so you’re probably no stranger to temporary dry spells now and then. However, if you’re facing a prolonged period of decline that seems to be based in circumstances completely out of your control, it may be wiser to arrange a controlled liquidation or sale rather than letting things get so bad you end up swimming in debt or going bankrupt.
The business is doing really well
On the other hand, maybe things are going incredibly well lately. Profits are up, and you’re scheduled six weeks out with work. You’re standing at a crossroads: you can double down and invest in growing the company to continue the current trajectory, or you can take advantage of the fantastic job you’ve done getting the business to this point and put it on the market for what will likely be a very profitable sale.
Why think about this now?
This isn’t an exhaustive list, but it hits the major factors that business owners need to pay attention to. In almost all cases, if you’re determined to stick with it and hang onto your business, you have that option. And, if that’s truly what you want, that’s what you should do. However, when these situations arise, there’s a compelling reason to at least consider an alternative.
The real point of this article is to make it clear that you should be thinking about these possibilities before they happen. That gives you a chance to consider your options and make logical decisions before emotions get in the way and/or time is suddenly running out. That’s how smart business decisions are made, even if those decisions result in the end of your electrical business.
Bruce Hakutizwi, Director of North America for BusinessesForSale.com, the world’s largest online marketplace for buying and selling small and medium size businesses.