- How Getting Your Business Valued Shapes its Future (2/20/24)
- Common Challenges to Selling a Business: Business Owner Insights (1/25/24)
- Considering Selling Your Business in 2024? (12/13/23)
- 12 Ideas to Attract and Keep Employees (11/13/23)
- Hope is Not a Strategy…and Private Equity Isn’t Your Escape Route (10/11/23)
- How to Successfully Sell Your Business to an Employee (9/25/23)
- How We Help (8/15/23)
Pedal to the Metal
Running a business can be tiring. Wait. Scratch that. Running a business IS tiring - even exhausting sometimes. We also know that when you’ve done it for several decades it can be difficult to find the energy to keep your business growing.
We often hear from business owners who are ready to sell because they want to retire and enjoy life. Awesome. The real risk at this point in their lives is that when they’ve made the mental leap to retirement that then their physical efforts usually follow. Thinking about retirement? Don’t get so far gone that you can’t give it one more big push. During the selling process, you must keep the pedal to the metal.
When we value a business, we consider the last three tax returns and the current year-to-date numbers. Businesses that get top dollar from a buyer have steady or increasing returns over that time period. Can we sell a business that fluctuates a bit? Yes, but only if there is a really good reason for that fluctuation; buyers will ask for an explanation right out of the gate.
People are naturally a little skeptical about why a business owner would want to sell a perfectly good business that’s turning an excellent profit. When they see erratic numbers or a decline over time, they get worried and may walk away. They want to buy something that is solid and growing rather than risk inheriting someone else’s problems. After all, you know your business better than anyone and if you can’t make it work, then how can they?
Here are some things to keep in mind when you’re thinking about selling:
- Continue to invest in marketing - keep revenue up and increasing.
- Make sure all your key positions are filled and are compensated appropriately – an unengaged workforce isn’t worth as much to a buyer.
- Go after that next big client – sandbagging is what people do in emergencies.
- Don’t back off on your time – if you’re an owner/operator, it can’t run on autopilot.
- Stay current – positioning the business for the future will set a buyer up for success.
When you make the decision to sell, it’s more important than ever to keep your foot on the gas and avoid coasting.
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