It’s a lot more difficult to sell a business than many owners think. This is a big investment and sellers need to work hard to make themselves as attractive as possible to potential buyers.
It’s not just about setting the right price, ideally you need to do as much as you can in the 12 to 18 month run up to selling your business. That includes getting the right support in place as soon as possible.
1. Discovering Your Perfect Buyer
Hopefully, the buyer is someone who is going to pay a good price for your business but you need to make yourself as attractive to them as possible.
The more you have a handle on what any potential purchaser is looking for the better. It could be that your particular business is valuable to a company looking to expand its capability or service in some way. For many, the location might well be a determining factor.
It pays to take a closer look at the competition as well as those businesses overseas that may well be attracted to your kind of business and try to determine how they will view your company from a buying point of view.
2. Using a Broker
It’s not easy to sell a business, even in a booming market, and getting the right sales team in place is essential. That includes using a broker who understands what it takes to buy and sell businesses in your particular sector. This will not only help you attract the right potential buyers, put in place the appropriate paperwork and listings but will help avoid many of the pitfalls that can lead to a bad deal.
3. The Full Description
As with any house sale, giving your potential buyer as much detail as they need to make an informed decision about your business is important. That includes adding images which show your company in its best light so it’s always worth having these professionally taken. It also means having a clear idea of your turnover and other business information and ensuring this is readily available.
4. Setting a Realistic Price
Most buyers will want a business that is worth the asking price. It’s very rare that someone will buy on the future potential, so setting a realistic price is going to be important. The number of buyers for any business will be finite and attracting the right people may well require you to be flexible in your approach. This is why choosing the right time to sell and preparing prior to going to the market makes such a big difference.
5. Can Your Business Survive Without You?
A lot will depend on the type of business you run and how many staff you have, but succession planning should be your central focus once you have found a credible buyer. What a lot of businesses want is for the transfer to take place as smoothly as possible. With many small companies, the day to day operation relies heavily on the owner. The big question, therefore, is how change of ownership is going to impact on this. Ensuring that you have all the right processes in place to ensure a smooth succession is therefore essential.