What's your exit plan?
In the startup world, there are well known exit plans. Since a startup takes on outside investment capital, and those investors eventually need a liquidity event, any business on the startup trajectory will be looking to eventually be acquired or do an IPO.
But for small businesses, it’s not nearly as clear-cut. Very few small business owners have an exit strategy. They have no idea where they're taking their business. They're driving the bus without a destination.
I think this is a very strategic error to be making.
When you have a destination, you know what you're working towards. Goals, especially end goals, are important for helping you make good business decisions. In other words, when you're working towards an exit strategy, some ultimate goal for your business, it provides a clear context within which you can make better business decisions.
Every business decision either moves you closer to the prize, or it takes you further away.
In the past, I’ve opined incessantly about working only with ideal clients, and firing the bad ones. When you have an end goal in mind for your business, you're able to actually define what constitutes a good and bad client. The bad clients get thrown overboard, and then you implement marketing strategies to attract ideal clients (who generally pay premium fees).
But none of this is possible if you don't have the end goal in mind. What are you truly trying to achieve in your business? Where do you want it to be in 12 months?
When I was operating my boutique tax firm, life became a lot more pleasant after I strictly defined what I wanted out of that business. Basically, I wanted a tax practice that consumed as little time as possible, but with decent revenue, such that I could have both the time and money to travel as I please. Being able to take a totally random trip to the Bahamas is how I wanted to live, and so over the course of about one year I built a business that afforded me that luxury. A few years later, what I wanted out of life changed, and thus the lens through which I made business decisions changed.
Seriously contemplate what you want out of your current business, and how your target market selection process plays into your goals. Hint: If you accept every customer, client, or patient with a pulse and a check, you're doing it wrong.
Factor your exit strategy into your business decisions on a daily basis, and you'll be moving towards accomplishing that end goal. This is the definition of a successful business.