6 Common Exit Strategies for Contractors

Contracting is a capital-intensive and risky business with potentially volatile profit margins.

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The construction business is also amazing, with the owners making a good return on their capital. Management teams and employees earn a great living while building projects they can be proud of that will last for generations.

Succession: Six Common Exit Strategies for Contractors. Liquidation, Pass Down to Family, Strategic Sale to Outside Buyer, Merger with Similar Contractor, Sale to Management, Sale to Employees.

The majority of contractors are privately owned by a small group of people who are usually also managing the business. 

Over time, those owners need to: 

  • Reduce how much time they spend in the business
  • Get their capital out of the business
  • Reduce their risks

There are 6 common exit strategies for these owners:

  1. Wind Down / Liquidation
  1. Pass Down to Family
  1. Strategic Sale to Outside Buyer
  1. Merger With Similar Contractor
  1. Sale to Management
  1. Sale to Employees (ESOP)

Each of these strategies has different dynamics for the net valuation amount, time, and risk. Not every strategy is available to or right for every contractor.  

We will explore each of these in more detail with future posts to help you identify which might be best for your situation.  


6 Common Exit Strategies for Contractors
Continue building value in your business, yourself and your key team members with a good succession strategy....

6 Common Exit Strategies for Contractors
Continue building value in your business, yourself and your key team members with a good succession strategy....

Capital-at-Risk: Basic Categories and Evaluation for Contractors
Contracting is a capital-intensive and risky business. Understanding the key categories of capital at risk, along with their different risk factors, enables construction owners and leaders to make better decisions.
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We provide a unique perspective for General Contractors wanting to take their company to the next level of success. From billion dollar businesses to emerging contractors; our hands-on approach accelerates profitable growth in all economic conditions.