"Get Organized In Order To Sell Your Business"
It doesn’t matter what you are buying or selling, as buyers will strive to buy as low as possible, and sellers will strive to sell as high as possible. It is all a matter of strategy for either side as they negotiate during the transaction. However, as a business owner looking to sell your business, you will need to get organized and ready to deal with the questions and issues that will come up during the sales process. Some the things you will have to deal with include:
Get Your Books and Records in Order. If you are a business owner who is even contemplating putting your business up for sale, you need to get prepared and organized immediately. Sloppy, incomplete, or inaccurate books and records can scare away potential buyers. In order to give buyers confidence in you and your business, it would be worth the effort and investment to get audited financials for several years. Although it may be costly, in the end it will be a worthwhile investment as it will give buyers a greater sense of your commitment and readiness for full disclosure.
Really Understand Your Selling Trends. Buyers expect and want to see evidence of profit and actual or potential growth. Buyers also want to understand your customers in terms of repeat business, customer turnover, and subscription/auto renewals (recurring revenues).
Be Real About Your Business Reputation. You should know what others are saying about you and your business. In real life terms, you want to be one step ahead of any question that might come up about your business so you are prepared to mitigate any negative Can your business run without you? In a perfect world the business is not reliant upon the owner for its success. In addition, documentation related to how the business runs is absolutely essential. A business manual with every detail necessary to make the business function is paramount. How else will a buyer be able to come in and successfully run the business if you are the only person who knows how to do what you do? Everything single thing needs to be written down and recorded.
Do you know what your business is worth? Similar to what a homeowner may do in getting an appraisal from a qualified real estate agent on a realistic selling price for their home, you should get the help of a professional to provide you with a business valuation to determine the fair market value of your business. If you have kept good books and records it should be relatively easy to provide a business broker with the required documentation.
If you have been sitting on the sideline trying to determine whether or not the time is right to sell your business, the time is ripe for action. If you take the time upfront to get yourself organized, you will help speed up the process and potentially realize a higher price for your business.