Preparing your Business for Sale
[We saw this article earlier today … and thought we’d pass on their advice! Adam Noble Goup]
by Matt Skinner, Businessesforsale.com, 2013-03-11
The further ahead you think, the more opportunities you have to consolidate and streamline your business for the sale.
Planning ahead can not only allow you to sell more quickly and easily, but even to make more money on the deal.
Do the housework
If you were selling your house, you’d make an effort to get it clean and tidy before showing it to prospective buyers. Treat your business the same way. Make sure your records and accounts are in order, and your filing system is easy to understand.
It should go without saying that you need to ensure your business is above board, with any outstanding debts or legal battles either settled before the sale or brought to the attention of the buyer in good time.
Maximize profits
Now that everything is in order, it’s time to make your business as appealing a prospect as possible. This might mean switching the focus of your business from long term growth to short term profits to show a healthy turnover, or it could mean showcasing the strategies that mean greater profits in the long run. Your accountant or a specialist business broker can advise you on the best option for your business and sector.
What’s it worth?
Even when you know your business inside out, it can be difficult to assess its value in the current market. However, you need a reasonable idea of the initial asking price you should set, and a minimum below which you won’t sell. There are many ways to evaluate the worth of your business, from totting up the value of physical assets to comparison with businesses of a similar size and type. Consider hiring an expert to make the valuation for you. A professional with the right connections can also help you find a buyer and ensure that negotiations go swiftly and smoothly.
Seize the day
If you’re not under pressure to sell, it’s worth waiting for the right moment. Market sectors can be temporarily buoyed or depressed by the global economy, or an unexpected trend can suddenly make your product or service hot property.
If you’re not under pressure to sell, it’s worth waiting for the right moment.
Alternatively, if you suspect that the bubble is about to burst for your sector, plan to get out before it does.
Plan your exit strategy
The chances are you’ll still have an interest in your business after you’ve sold it, whether you’re a shareholder or you just don’t want to see all your hard work come to nothing. Make sure things don’t go to rack and ruin after you’ve left by providing for the future of your business.
If you are planning to make a colleague your successor, start training them now. Share information and deal with any questions they may have. If you will be available as a consultant after the sale, make this clear. Your knowledge and expertise will be valuable to the buyer, but try not to get upset if they override your advice. After all, it’s not your baby any more.
During 3 decades of M&A service, Jeff Adam has successfully completed the sale of over 825 businesses and advised or completed 1,000’s of business valuations and exit plans. An entrepreneur in his own right, Jeff has started and grown 12 companies in fields including international finance, B2B services, business valuation, construction, screen printing, Mergers & Acquisitions, engineering, and manufacturing. Jeff has donated his time as a distinguished speaker at numerous national & international conferences since 1977 covering topics such as environmental services, engineering, media, craft breweries, exit planning, business valuation, charitable giving, management, business brokerage and M&A fields.
Jeff is President of Adam Noble Group, LLC, a national M&A Advisory firm, professionally valuing and confidentially selling profitable businesses owned by exit-motivated business owners to qualified strategic, corporate, private equity, partners, management, and first-time buyers. Jeff establishes rapport, builds trust, and educates business owners in the steps to meet their goals as they prepare and achieve the discreet, confidential exit of their business. Jeff exclusively represents sellers of $1M-50M value enterprises and endeavors to transfer their businesses to qualified, capable acquirers who will build upon the seller’s vision, goals, culture, and history. Jeff maintains lifelong repeat and referral relationships with sellers, their acquirers, and service providers.
Adam Noble Group has multiple M&A and business broker specialties: Manufacturing, Defense Industry, Oilfield services, Construction trades, Craft Breweries, Partnership Buyouts, Manufacturing, Service, and Wholesale Distributors.
Our M&A advisors and business brokers are all multi-industry entrepreneurs who have successfully exited their own companies. Jeff has walked in your shoes! Jeff wants to put the BIGGEST CHECK of your life in your pocket! Please contact Jeff, and he will confidentially answer all your questions.
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