Is the timing right for you to sell your business? Perhaps you’re a baby boomer who is eyeing retirement. Or maybe you’ve built a solid business and your employees want to take it over. There’s even a possibility of a private equity group looking to deploy their cash reserves to make purchases and looking for a business just like yours.
What would it involve to prepare your business for such a sale or transfer? Usually a two-to three-year plan is required to position a company for an optimal sale. Your company and your books may still be recovering from the recent difficult years. But as the economy improves your bottom line is probably looking brighter. Consider that a high point in earnings is an excellent time to look towards a sale.
To properly gauge the value of your business you must put yourself into the shoes of a potential buyer. This is no small trick! You are no doubt partial to your business and probably see it with rosier glasses than a buyer would. A better option is to find an objective adviser, business broker, or other professional to assist you with reasonable valuation.
And then move on to ask for help in identifying areas you can enhance in order to increase that value. Look into the issues of your changing customer mix and the marketing messages you are using to reach those folks. Are you reaching the right people with the right information? What about your workforce, are they skilled and ready to start fresh with another business owner? If not, what needs to be added to their knowledge and skill base to make them so?
Look also to your products and services and ask yourself if you are keeping up with the pace of change and innovation. Is it time to make some new starts or modernize? What about your internal systems, are they up to speed? Your information systems? Can a new buyer walk in and find everything? Can he or she assume control right away, or will there be a steep learning curve?
Getting your house in order prior to a sale will make you more attractive to buyers and improve the odds that you’ll get top dollar for all you’ve built. The time might just be right.