When you have a successful business, it is sometimes difficult to make the decision to sell. You have devoted your time, money, and energy to building, running, and operating your business. People become attached to businesses and love them like they are their children or family. There comes a time, however, in every business for a change of ownership.
People sell businesses for various reasons, some of which are disputes, health, retirement, stress or burnout, trading up, relocation, and financial hardship. Obviously, the best time to sell a business is when it is profitable and growing!
Before you prepare to sell your business and list it for sale with a professional business broker, be sure you are ready to sell and move on. Be prepared to see the buyer make changes to the business. Most buyers will continue operating the business as it is at closing and gradually make wanted changes, but some buyers make definite plans and start making changes immediately. Remember, the buyer is purchasing your successful business and is looking for ways to make it even more profitable. That is a compliment to you and your ability to build your successful business. Think of ways you could improve and realize a buyer will likely think of similar ways. If you really wanted to make changes, you probably have a reason for not doing so. Don’t question your decision to sell, as it is probably time to move on and let someone else make those decisions.
It is wise to select a professional business broker to help you sell your business; and, after some discussion with that broker, you may decide you need to get some things in order before you list the business. If that happens, the broker can guide you through the proper steps to take to prepare for the sale.
Accurate financials are extremely important in every business and will definitely be thoroughly looked at during the due diligence period before the closing papers are signed. All income and expenses must be provable, so receipts are important. Sometimes owners pocket cash, which cannot be shown as income or profit when they decide to sell. Even though an owner thinks a buyer will understand when the situation is explained, it is a risk to tell anyone you have not been paying taxes on part of your earnings. The only thing that can be used when calculating the value of a business is provable income, which comes from your income tax returns. That being said, there are definite expenses you can write off as a business owner, which will be added back, increasing the cash flow and the value of your business. Your business broker will help you with that.
Okay, you have decided it is time to sell your business and have selected a professional business broker to help you. The broker evaluated your business, helped you determine a selling price that will sell in today’s market, prepared a marketing package and confidentially marketed your business to qualified buyers. In a normal situation, a qualified buyer will meet with you, make an offer, and go through the due diligence process and closing, with your business broker helping you handle any problems that may arise.
You expect everything to go smoothly, as you want to sell and the buyer wants to purchase the business. The broker wants a win-win situation that will lead to your getting the highest possible price for the business on acceptable terms and the buyer getting a good value for the money. This can happen. Just be sure you are ready to sell to a qualified buyer who may be making plans to continue to make your business grow and be even more profitable. Be ready to close the deal and cherish the fact that someone appreciates your business enough to increase what you started.
