Selling a business
Selling a business is a key turning point in any career. Have you started to consider selling your business? Whether you have three years invested in your business or 30, selling it is a big decision and eventually a life-changing one. Before you sell your business, ask yourself the following five questions:
1. Why am I selling? There has to be a reason the idea of selling your business came up in the first place. When selling a business, it is essential to know why you are selling. The potential buyers will ask, your employees will ask, your friends and family will ask, so you ought to have a carefully thought-out answer. Your answer to this question need not be overly ambitious or valiant, but truthful and simple.
2. What am I hoping to achieve by selling? After you have clearly defined why you are selling, the next step in selling a business is to decide what you hope to achieve by selling. Is this just the next logical step in your career or are you looking for a dramatic change? Or perhaps selling is part of your financial plan. As you plan the sale, you will need to have clear goals to guide the process.
3. How is the business really doing? When selling a business, this can be the moment of truth. Sit down with your team, making sure to include your accountant, and dissect the business’s growth. The best time for selling a business is during a time of growth or stability. It is important to not over or undervalue your business, because any buyer worth their salt will do their research and see right through it. You want to have an accurate picture of how the business is really doing before selling.
4. What am I going to do after selling? When selling a business, it can be easy to get wrapped up in the long and arduous process. Then you complete the sale and are left with no plan. Almost as important as the sale itself is what you are going to do after the sale. Is selling the business part of an exit strategy? Are you retiring? Are you going into another industry? Even if your plan is to take up gardening or volunteer at your local animal shelter, you need a plan. Don’t wait for the end of the sale of your business to start looking for the next thing!
5. Is it the right time? Selling a business is a very time-consuming process. After you have answered the above questions, the next step in selling a business is finding the right time to sell. There are a lot of items to prepare before selling, and the process itself can take a while, so take that into consideration as you decide on the right time to sell.
There are a lot of things to consider before selling a business. If you are interested in getting started but aren’t sure exactly where to start or what the next step is, contact LJ Hooker Business Broking.