As we’ve emphasised previously, business owners should have an exit strategy in place from the very start of their venture, whether they’ve started a new business or acquired an existing one.

A lack of preparation can be absolutely fatal to business owners’ hopes of a successful sale and can lead to a rushed process that ultimately results in a sale to the wrong buyer at the wrong price.

Having an exit plan in place can ensure a far smoother sale process and enable owners to fully capitalise on conditions that are conducive to a successful, profitable exit.

Of course, it is also vitally important that owners with an exit plan in place are able to spot when is the right time to act on those plans. No matter how well thought out an exit plan is, selling at the wrong time can also threaten their ability to secure the right price and the right owner.

Here are three key things that indicate that the conditions are right to execute an exit plan.

The business is thriving
Exiting a business when it is at its peak performance and growth might seem counterintuitive, especially if you're not nearing retirement. However, this could actually be the ideal time to sell for several reasons.

Firstly, a prosperous company with strong growth potential is likely to attract a higher valuation and sale price. Buyers are drawn to successful businesses because they offer the promise of future profits, reinvestment opportunities, and market expansion.

Additionally, demonstrating your business's success and growth projections can streamline negotiations. It puts you in a strong position, reducing the chances of buyers haggling to lower the valuation.

Finally, a thriving business can provide continued earnings even after the sale. Structuring a deal with an upfront payment and deferred earn-outs allows you to share in the business's future financial success.

The business is ready to grow without you
Many business owners reach a point where they realise their company can continue to thrive and grow without them at the helm. This often happens when responsibilities have already shifted to senior staff or emerging leaders within the organisation.

At this stage, stepping aside might be the best way to help the business seize future growth opportunities. Whether you sell the business to a new owner who will work with the current team or transition it to your staff through a management buyout, you can be confident that the business is prepared for continued success.

Market conditions are right
Selling when your business is healthy and market confidence is high can be very advantageous. Ensure the market price reflects the true value of your business. Favourable conditions, such as low interest rates, can make it easier for buyers to secure financing and reduce the risk of the deal being derailed by valuation gaps.

Monitor market sentiment towards small to medium-sized, high-growth businesses. If your business is flourishing and there is strong buyer interest in companies like yours, it might be the perfect time to sell.