August 25, 2015
5 Important Things to Consider when Selling Your Business
Selling Your Business? What you need to consider first –
It’s finally time to sell your business and after all your hard work you want to maximise the return on your investment.
So let’s hear what an industry expert has to say about maximising the return on your investment.
The 5 important things for you to consider when selling your business:
1 – Get your house in order
Make sure your business is performing as well as it can. As a priority, assess your cash flow, your expenditure, your tax strategy and other elements of your operation to see whether they are optimal.
2 – Consult with experts
Consult your business broker, solicitor and accountant when setting a sale price and always take advice on other elements of the selling process. This allows you to focus on doing what you do best – running your business. Leave each expert to their chosen field and concentrate on maximising your business outcomes.
3 – Honesty is the best policy
The truth is always going to surface, so when you decide on selling your business, be upfront about everything from the beginning. Experienced investors understand that every business is going to have positives and negatives – they understand that there is no such thing as the perfect business. If you are honest and transparent from the start there is less risk of a deal going sour because the buyer uncovered something during due diligence that wasn’t accurate or an instance where the truth has been stretched. Honesty, as always, is the best policy in all business transactions, and selling your business is no different.
4 – Show buyers a bright future
When a buyer investigates a business, their primary focus will be on the proven track record of the business they are looking to purchase. However, there is the future potential to consider as well. Put together a growth strategy to show potential buyers which will excite them as to the future prospects of the business. One of the most common questions buyers ask is, “If you were going to stay here, how would you best grow the business?” A very significant asset you have as a business owner is the intimate knowledge of the business you operate – use that to point out opportunities for the new owner to expand the business. The few days’ work it might require to put together a growth strategy may well pay significant dividends in the sale of your business.
5 – Expect to answer a lot of questions
Purchasing a business has become more popular in recent years, with many people looking to become independent and quit their 9 to 5 jobs. Consequently, this has led to an increased number of inexperienced buyers inquiring about businesses for sale. This can be significant time drain on you. That is why it is important to use the services of a professional broker. The broker’s job is to handle the questions and vet the buyers for you.
Selling your business will lead to a lot of questions and you need to be prepared to answer them all – regardless of how simple they may sound. This can be a serious burden on the time you have available to run your business and to maximise profit. Always seek the assistance of a professional and skilled broker – they are always worth their involvement and fee.