Friday, July 31, 2020

28A – Your Exit Strategy

1) Due to the nature of the business, our spotless services business plan has a limited window of opportunity. The business will only be profitable as long as there is a communal and societal  fear and anxiety surrounding COVID-19. The business is only profitable as long as customers are afraid to visit small businesses at their physical locations and make business transactions as they did during the pre-pandemic era. I think that the best course of action for the business, considering these factors is to play it by ear and to gauge how both the government and the public face issues regarding the pandemic. I estimate that the business would be profitable for no more than a year. After that, if things are scaled back, it could just be a PPE delivery service to individuals and private homes. It could either be subsidized by the city or county, if not then business would stop after fixed costs and contracts are completed.  Profit would have been made, and the rest is left behind. I find it unlikely the a buyer for the business would be found. I would say it should stay as the delivery subscription service until it is no longer worth doing. 

2) I selected this exit strategy as it is one that fits the nature of the business itself. There is an opportunity for the time being, and money to be made from it. However, it is not exactly long term and won't be lucrative for long. It is a quick buck to be made, though it could make a lot of money in a short period of time. It is all because of the nature of it. However, the lasting psycho-societal damage the pandemic has caused could still make a PPE delivery subscription profitable. 

3) I don't think my exit strategy has influenced much of the actual business itself. Though I assume I should have taken this into account, since the business is going to be relatively short term and the resources should not keep me in business under contract more than a year. The opportunity is fleeting, the business should make its money and then end it or at least severely scale it back. I do think it has limited by intention to grow since I thought there wasn't much opportunity after the pandemic slows down. However, I think I made a mistake limited myself. I think that a subscription PPE delivery service could work. Some contracts can be maintained and it could still make money. 

1 comment:

  1. Hey Brian, good job on finding out your exit strategy, I completely agree with your conclusion about wrapping up operations after the pandemic has died down, as you have correctly assumed that demand will fall right after. This strategy is the best for your idea and I do believe you should make as much profit as possible and then leave before you start to incur more costs. However, if you would like to still scale down operations and do some transactions it is not a bad idea as well.

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