So you’re thinking you want to sell your business?
When you set out on your business dream there were most likely a lot of things to occupy your mind:
- Can I pay the bills?
- Can I find some customers?
- When will I be able to take a holiday again?!
Probably one of the last things that crossed your mind was what will you do when you no longer want to run the business…
At some point there may come a time when you will want to sell your business, so how do you maximise the value of your business?
Maybe you want to spend your time and energy in a different area. You may want to retire. Perhaps you want to pass the business onto the next generation or maybe you want to get investment and will be looking at selling part of your business to generate the funds for future growth.
Whatever your reasons, you’ll want to ensure that you get the maximum value for the asset that you laboured and poured your soul into.
Here are 5 tips to maximise the value when selling your business:
Have a plan.
A 5 year business plan that demonstrates to a potential buyer a keen understanding of the businesses strategic situation and shows a clear path to future growth can have a big impact on the valuation and attractiveness of a business.
<H3Systemise the business.
A business that is overly dependent on key personnel represents a greater risk to a potential buyer than one that has clear, well documented processes, systems and measurements in place. If you can show that the impact of any individual moving on would be minimal you’ll generate a greater price.
Invest in your business if you’re thinking of selling. A crucial mistake many business owners make is to take their foot off the gas and slow down as they approach sale. Any potential buyer wants to know that they’re buying a business on the up – invest and you’ll receive much more back in your sale price.
Get your business valued regularly.
If you get your business valued regularly you will learn what it takes to drive your business valuation up. By focusing on your valuation you will automatically begin to develop strategies to deliver a higher value.
Possibly the single most important factor in a business valuation is whether the business works without you. Once you’ve structured the business so that you no longer need to be involved you open up a whole new level of buyer who will take on your business as an investment.
Wherever you are in your business journey you should be thinking clearly about where you want the business to finish. After all you wouldn’t start building a property without a clear idea of what it’s going to end up being – why would you do the same with your business?
Make sure you follow the above tips to drive your asset up and get the rewards your hard work deserves.