There may come a time when I will need an exit plan. Within my Entrepreneurship Master’s Program I have been required to create that plan. The exit strategy known as liquidation can be described as the process by which a business closes and sells off business assets (Maguire, 2016). Assets of the business such as business property would be sold to obtain cash (Maguire, 2016). Additional items such as inventory on hand can also be sold off or liquefied (Rogers, 2014), as well as, fixtures, equipment, and furniture (McCarty, n.d.). The cash obtained would first be used to pay off any outstanding debts the business owes (Maguire, 2016). In certain circumstances and if a company has multiple stores, it may become necessary for a business to liquefy certain locations due to lack of sales in that area or due to outside issues unrelated to the company. In this case, the business may find they must close a location, liquefy assets, and relocate employees to other locations.
The exit strategy that I have chosen is liquidation. I have chosen liquidation because it will be the easiest way for me to obtain cash for the books that I currently have in inventory. Since my books are available on Amazon and cost me nothing to remain there, I can leave my books on Amazon and continue to obtain passive income while at the same time reclaim the monies that I have invested in my business. In addition, I am the only stakeholder.
References
Maguire, A. (2016, November 23). Cashing out: Understanding different exit strategies. Retrieved August 29, 2019, from https://quickbooks.intuit.com/r/business-planning/cashing-out-understanding-different-exit-strategies/
McCarty, D. (n.d.). Liquidation as an exit strategy. Retrieved August 30, 2019, from https://www.bizfilings.com/toolkit/research-topics/running-your-business/exit-strategies/liquidation-as-an-exit-strategy
Rogers, S. (2014). Entrepreneurial finance: Finance and business strategies for the serious entrepreneur. Place of publication not identified: McGraw Hill Education.