Starting a business means bringing a dream to fruition and devoting your working life to doing something you love. Of course, being an entrepreneur isn’t necessarily a constant. After several years of running a business, some people find they want to pursue other passions. Others decide to leave the business world altogether.
If the time has come to move on from your small business, selling it requires a certain amount of planning and preparation. It’s important to understand some of the finer points before placing your company on the market. Doing so will help ensure you find the right buyer promptly and sell for a fair price.
Know What the Business Is Worth
In your eyes, your company is priceless. That means you might be apt to overprice it. Of course, buyers tend to see matters in an entirely different light, so they’re likely to put a lowball offer on the table.
In most cases, there’s a middle ground between those two ends of the spectrum. Several factors can affect the actual value of the company. Consider bringing in a business valuation company to provide a professional, unbiased view of the situation. Don’t overlook the worth of any intellectual property that might go along with the business, either.
Develop an Exit Strategy
Selling a business isn’t quite as simple as getting rid of an unwanted piece of furniture or a used car. Numerous questions and considerations come into play. For one, you may need to work with an attorney to make sure no legal issues complicate the transferal of ownership. At the same time, know what you’re going to do after selling, and be sure the proceeds from the sale will be enough to meet your financial needs moving forward.
Get Financial Records in Order
Prospective buyers generally want to know what they’ll be getting into if they purchase a business. As such, they’ll probably ask to see financial statements, tax returns, and other relevant documents. If you haven’t been keeping diligent records or simply want to be sure everything is in order, having an accountant go over the books and straighten out all the paperwork is advisable.
Spruce up the Business
Appearance matters to potential buyers. This is true whether you’re selling a house, a business, a car, or a pair of shoes. If it looks run down and needs numerous repairs, it’s going to stay on the market longer and might not sell for quite as much as you’d like.
Clean up the business inside and out, make necessary repairs, and carry out any other tasks that will improve its appearance. Giving the business a facelift will take time and money. It’ll be worth it in the end, though.
In a Nutshell
If the time has come to sell your business, don’t jump into the process without considering all the important points. Get your financial records, legal matters, and the business itself in order before putting it on the market. Know the business’s worth as well as what you’ll do once the sale is complete. All these measures will ramp up the business’s market value and reduce the amount of time it takes to sell. They’ll also give you an added layer of protection.