Exit Planning Starts Years Before the Sale
There is a version of exit planning that means deciding when to sell. It is the one most articles describe, and it is written for somebody holding a portfolio of positions, any of which can be closed on a good day.
That is not the situation an owner is in. You have one business, it is probably most of what you own, and you will do this once. The decision is not when to sell. It is what to hand over, and that takes years to build.
The Buyer Is Buying What Happens After You Leave
This is the sentence the whole subject rests on. A buyer is not paying for what the business earned last year. They are paying for what it will earn once you are no longer in it, and every difference between those two numbers comes out of the price.
So the practical question is not what the business is worth today. It is what survives your departure. Customers who deal with the company rather than with you. Staff who know the answers without asking you. Processes that exist somewhere other than in your head. Suppliers who have a contract rather than a friendship.
Owners consistently underestimate how much of the business is them, because from the inside it just looks like doing the job. Understanding what actually moves the valuation is the useful starting point, because it names what to work on.
Cash Flow Is the Thing Being Bought
The original version of this page made one point worth keeping: cash flow decides the timing.
A buyer funding the purchase with debt has to service that debt out of this business's cash. That makes the shape of your cash flow, not just its size, part of what you are selling. Strong and consistent cash flow supports a longer hold and a better price. Erratic or declining cash flow limits both, and it limits who can buy at all, because lenders look at the same numbers.
Which is why exit timing is less free than it looks. Selling into a weak year costs real money, and a business that has been prepared can wait for a better one. A business that has not been prepared is often sold at the moment the owner runs out of patience, which is the worst possible timing and the most common.
The Two-Year Version
If a sale is somewhere on the horizon, the order of work is fairly settled.
Reduce what depends on you. The slowest item, so it starts first. Delegate the relationships before the tasks, because relationships are what a buyer worries about.
Clean the financials. Three years of statements a third party can verify, with the personal expenses separated out rather than explained away later. Every unexplained adjustment is a discount.
Fix concentration. Any customer worth a large share of revenue is a discount, and the fix is slow, so it starts early or not at all.
Write things down. Not a manual nobody reads. The half dozen processes that only work because a specific person knows them.
Then decide what kind of exit you want. A sale to an outside buyer, a handover to family or management, or something in between are different transactions with different preparation. Succession is its own decision and it is worth making deliberately.
Every item on that list also makes the business better to own. That is the argument for starting before you are sure you want to sell: nothing here is wasted if you stay.
The Takeaway
An exit strategy is not a decision you make at the end. It is a set of changes that make the business worth more and easier to leave, and the ones that matter most are the slowest. Two years is a reasonable runway. One quarter is a fire sale with a plan attached.