EXIT STRATEGY

[sherlock]

Figured this is as good a place as any to express my thoughts on the importance of having an Exit Strategy. Most of us probably come to this part of the forum when thinking about the "business" side of the business.

Many of us are operating without a business plan. I don’t personally see anything wrong with that.

However, while much advice is available on other portions of your business plan, the part of the plan most often ignored by those without one is the Exit Strategy.

Even without an official business plan, we often do our due diligence when organizing our business, forecasting projections, researching industry data, and searching for funding. Yet, we forget about keeping an eye on our exit strategy.

Without getting too technical – because I don’t have the smarts to get “too technical” – let me just offer this suggestion when it comes to vending and your “exit strategy”: Keep accurate records from DAY 1.

If you are already past “day 1” of your vending business – then treat today as “Day 1” and start keeping accurate records NOW.

Every collection, expense, and asset should be accounted for and all monies accurately tracked/documented.

Do not get lazy with your record keeping. No matter what your exit strategy is. Whether you will leave the business to your heirs, someday sell it in order to invest in another venture, liquidate locations in chunks in order to exit slowly, sell it all as a whole route some day, or even if you don’t know what your exit will be, either way, you will NEED to have kept accurate and verifiable records in order to set MAXIMUM value for your business.

When the time comes to exit your vending venture (in whole or in part), you will have to do one of two things in order to get what your business is worth:

1. Rely on accurately kept records to get top-dollar for your business

-or-

2. Rely on your ability to find a “sucker” willing to pay top-dollar for unsubstantiated claims.

PT Barnum’s claim about suckers aside, it is far easier on your time and your spirit to be able to rely on the first option.

I suggest this, not as an experienced vendor, but as someone who has only been at this for a few months. I’m new to vending, but not new to business ownership. It’s because I am so new to vending that I got to thinking about the importance of record-keeping in this (or any) business venture. I always try to develop the good habit of detailed record keeping from the very start…it’s easier than trying to clean up later on down the line.

[whaletail116]

An absolute must.  Excellent post.

[alyssamma]

Agreed...great post.

[coinvestor]

An absolute must.  Excellent post.

Ditto!

[mission vending]

Well said.

Unfortunately, many people don't treat this as business, either full line or bulk. Most of the vendors that I have known over the years look at vending as a sideline or just as a way to "buy" a job. With that type of mentality it's only natural to not keep good records or even no records at all because this is for the most part an all cash business. Others are intentionally trying to avoid paying their share of their tax liabilities and trying to beat the system. I feel that it is certainly a shortsighted way of doing of things.

In order to achieve any significant level of success in this or any industry for that matter you have got to know where and how the money comes from and where it goes. By not tracking the performance of their businesses many vendors trap themselves into an owner/operator situation. I'm not saying that keeping the business small is bad, if that's all you want then great. For those wanting to grow their businesses, having a firm grasp and understanding of the cash flow is essential to longevity and success.

Whatever it is you want out of vending, take the time to learn about our industry and the issues we face.

Finally, READ (nonfiction), even if it's not about vending, The things that will make you a different person a year from now are the people you meet and the books you read.

OK, time for me to get down off of the soap box.

[antoniocinisi]

great post and good advice.