More than four in ten (41%) key decision makers at UK SMEs say they are considering an exit from their business in the next 5-10 years, with nearly two in ten (17%) saying they will certainly exit in that time frame. Specialist lender Shawbrook recently surveyed SME leaders on a range of issues including exiting their companies.
When quizzed on their preferred method of exit, a private sale (27%) and an acquisition (27%) emerged as the most popular choices. More than a fifth (21%) of key decision makers would look to merge, with nearly a fifth saying they would prefer a management buy-out (19%), a management buy-in (18%) or via family succession planning (17%).
Further down the list, more than one in ten (13%) would like to use a different type of succession planning and 10% ambitiously look to exit via an Initial Public Offering (IPO).
Neil Rudge, chief banking officer for Commercial, said “Exit planning is a natural part of the business lifecycle and a process that all leaders have to consider at some point. The future and longevity of the business rely on finding the right pathway to exit when the time comes. There are numerous options and all come with their own unique advantages, so it is crucial to accurately assess your options and decide on the option that best fits you, your family and your employees.”
“Our latest research shows that SME leaders are making plans and considering all the options available, from family succession to IPO. Knowing the direction of travel helps to plan the more immediate, as well as the longer term growth strategy and the funding you might need to realise those ambitions and ensure a smooth and successful transition.”
Methodology
The research was conducted by Censuswide, among a sample of 506 full time senior financial decision makers (CFOs, FDs, MDs, CEOs) at or business owners of Small and Medium Sized Businesses (with a turnover between £5m and £50m). The data was collected between 5th April 2024 – 12th April 2024. Censuswide abides by and employs members of the Market Research Society and follows the MRS code of conduct and ESOMAR principles. Censuswide is also a member of the British Polling Council.