According to a recent IBIS World industry report, restaurants and personal services businesses account for nearly one-third of all sales for business brokers. With this kind of competitive marketplace, savvy business owners use the following tips to help their company stand out from other listings.
You may be asking if now is really the right time to sell a business.
Perhaps you are daydreaming about the next stage of life, ready to move on to a different business opportunity or to enjoy a more relaxed schedule. Each day we talk to small business owners in the same position. They feel a draw toward taking the next step of moving on to something new, but need to sell the current business first.
Most of the time, we speak with business owners who are unaware of the true value of the business. They know they’ve spent hours, years, or even decades building up a robust and profitable business but aren’t sure what kind of profit they can make when selling.
At Alliant, our team is here to talk through your priorities; what your reasons for selling the business are and what your next plan might be. Based on this, we provide guidance on how best to prepare the business before listing. At the end of the day, we want you to capitalize on what you’ve built so you are paid what you deserve.
Over the past two years, we’ve seen first hand the record numbers of small business sales. We know your business must stand out from the crowd. Here’s how we encourage business owners to ensure their business is ready for a successful transaction and smooth transition.
Get Your Records in Order
Proper paperwork is part of due diligence for any potential buyer to review. It must be complete and up to date, with accurate numbers. Collect and organize bank records, P&L sheets as well as personal tax returns showing your reported income over the past two years. Include client lists, copies of service agreements and any paperwork regarding lease agreements, supplies, and equipment.
If you don’t have enough paperwork to substantiate your asking price, a buyer may offer far less than the value of your business. Another reason to get your records and books in order is to indicate that your business is well-run and continues operating in healthy financial condition.
Stay Intent On Your Business
Selling a business can take time. During that process, you don’t want to lose sight of running the business. It’s even more important to review your organizational structure, identify key employees, and keep a strong marketing program alive. To get the best possible price for your business, it should be more appealing than ever.
If possible, consider outlining how the transition will take place to alleviate any concerns employees, clients or buyers may have. Businesses with an established revenue and a sound exit strategy in place are highly desirable to new owners.
Get Help From An Expert
An experienced business broker can sell your business the right way, to the right buyer while you keep your focus on the business operations until the sale is complete. This helps employees and customers feel secure during the transition, and reduces potential disruptions during negotiations. Discrepancy is key here as change can make employees and clients nervous. At Aliant, we have spent years, decades even, developing relationships with buyers that we can access with complete confidentiality.
Our team works with your on identifying the priorities of your sale. These priorities will help with the asking price and during negotiations. Sellers often think their business is worth more than what they are offered, but few buyers will overpay for a business. It’s our job to navigate these negotiations for you with your goals and objectives in mind.
Many business owners want to try and sell the company themselves. We understand how appealing that can be initially. Yet, selling your professional services business is not necessarily a fast process and it can quickly become overwhelming. Don’t let frustration prevent you from reaching your next goal. A simple conversation may be all it takes to move toward selling your business for a profit. If you’re considering selling your business in the near future, contact us today to talk to an expert and discover we can help keep the process streamlined and simple.