Many entrepreneurs think they can bid a fond farewell to their companies when the time comes to cash in.

In reality, they face a long goodbye with exit deals taking anything up to two years to complete.

That is the finding of a report by Coutts & Co, the Queen’s bank that also has a strong entrepreneurial client base.

The report examines for the first time the challenges facing business owners when the decide to sell up. It says that although 46 per cent of entrepreneurs believe that selling their companies will take less than one year, the reality is that it actually takes up to two.

The report also reveals that on the day of actual sale, only 36 per cent of owners felt elated or happy. That was nearly matched by the 32 per cent who said they were relieved and the 26 per cent who were filled with tiredness, sadness or anti-climax.

On a financial level, 59 per cent overlooked their financial planning until the last minute, despite 79 per cent agreeing that it is an important part of the process.

The report also found that:

n Nearly three quarters (71 per cent) of business owners who took part in the survey think about selling their business on at least a monthly basis;

n While 25 per cent decided to retire early following exit, 40 per cent still needed the thrill of running a business and went on to start again, while 51 per cent also still have some direct involvement in the business they have sold; 

Nearly 90 per cent supported the creation of a specific exit plan.

“This report has shown that alarmingly, two-thirds of entrepreneurs are risking long-term business success by not giving proper thought to their exit strategies,” said Andrew Haigh, managing director of the entrepreneurs client group at Coutts.

“But in today’s difficult market, while planning for this exit may not seem an obvious priority for owner managers, the buyout industry will eventually open up, merger and acquisition activity will increase, as will private equity investment, therefore it is essential that entrepreneurs and businesses start planning if they’re looking to take advantage of an economic upturn in the future.

“Experience has also shown that the exit, which is often the one opportunity to realise significant personal wealth, is the final challenge as entrepreneurs extract themselves and the financial value they have built up in the enterprise.”

Joanna Thornell, the bank’s managing partner in the West Midlands, said: “At Coutts in Birmingham we can count over 70 per cent of our client base locally as entrepreneurs, which is perhaps unsurprising when you consider that last year in Birmingham alone, there were over 218,420 registered businesses and 6.4 per cent of the region’s adult population were partaking in entrepreneurial activity; compared to a nationwide average of 5.5 per cent.

“This is a significant change from 2004, where activity in the West Midlands was at just 5.2 per cent and lagged well behind the national average of 6.3 per cent.”

“Creating businesses of scale is often a marathon rather than a 100m sprint. Weathering the recession taps the creativity and resilience that is at the heart of any entrepreneur and in fact often in recessions great businesses are founded as the uncertain markets spur entrepreneurs to seize opportunities.”

The Coutts report, The Long Goodbye: myths, realities and insights into the business exit process, can be downloaded at www.coutts.com/entrepreneurs