In the life of many business owners, there will be a moment when you realize that you could make some money if you decide to sell your business. How do you know when it’s the right time to sell? There are quite a few factors which could influence when that time is, and if you’re paying attention, you may see an opportunity that is too good to miss.
From illness, to bankruptcy, to new opportunities, there are many personal factors which can influence when you sell a company. One way to be prepared is to have an exit plan already in place well ahead of time. This is a strategy for how and under what conditions you will sell your business. Your liquidity, profit projections, average performance, and more all need to be considered as part of the plan. You may not be able to plan for personal and economic factors beyond your control, but you can have a road map for what to do when you need to sell.
Size Up Your Competition
Competition exists when you own a business, and when you want to sell a business it will continue to exist. There are other businesses which will be on the market for sale, and it’s very likely that there will be more than a few that offer the same general services that you do. Unless you’re a completely original manufacturer or provider of a service that nobody else can offer, you’ll have to look at the competition as well.
Your competition may also be interested in buying your business, especially if you’re either slightly ahead of them or slightly behind. That means that they’ll have the capital for a sale, and that they’ll be all the more interested in making the purchase and getting rid of their closest competitor. If you find yourself in a highly competitive market, don’t be surprised if the buyer is someone that you already know from experience.
Your Business Has Matured
There are many stages that a business will go through if you’ve built it from the ground up. You’ll have the start-up phase, which begins with your vision, following by early growth, then development, and finally the maturity phase. Throughout each phase, you’ll be dealing with different problems within your company that will require different strategies and solutions. It is no different when it comes time to see a mature business. A mature company is valuable. If your business has matured successfully and continues to offer profitable projections, it may be time to consider some of the offers that you’ll see.
What To Do When It’s Time to Sell
There are several things you need to do to prepare yourself for a business sale. First, you need to have a good idea of its actual value. You can get a good idea of value by looking at prices for similar businesses in your area.
You also need to decide how you want to market your business. Perhaps you have an idea of an interested buyer; for example, an employee who would be able to take it over. If not, you will need to list your business for sale in venues like newspapers or online classifieds. Finally, you will need to come to an agreement with a potential buyer about price.
Not surprisingly, the entire business sales process can be a stressful one, especially since you still have the day to day responsibilities of a business owner to deal with. The best way to make a business sale easier is to hire a business broker, who can do the valuation, marketing and sales negotiations. Call Sunbelt Business Brokers to talk to a professional who will have a non-obligatory discussion with you to fully explain the process.