Value-adding Tips For Selling Your Business
The chances are that if you own a business, you have put a lot of time, effort and equity into growing it into what you have.
If you’re looking to sell your business for whatever reason (retirement, finances, building another business etc.), you will want to get the best sale price that you can for that business.
When it comes to selling your business, numerous factors will come about that will affect the projected value of your business and how quickly it will sell on the market. Buyers for your business will also be looking for ways to lower the sale price of your business to mitigate how much they will end up paying, while you as the seller will be looking for ways to ensure that your business sells at the highest possible price.
To ensure it sells for the maximum price and with the least amount of fuss, you may want to look into establishing and building additional inherent value into the business to further maximise your potential sale price before selling. Assess your business internally and externally and look for opportunities to create value that buyers will appreciate and recognise the extrinsic worth of.
For example, suppose you are looking to add value to your business, some of the key characteristics you will want to identify are strong cash flow, a good history and reputation, is a business with a niche specialisation that has room to grow, where the business is located, if it is situated in a growth industry with a competitive advantage over others in the same industry and having good staff, products and services. Then consider how can you prove and demonstrate that.
Characteristics that may lower the perceived value of your business on the market include the weak financial position of the business, a small customer base and poor industry outlook, key relationships held with the owner, poor record-keeping and selling dated products or services. Think about it like a hurdles race… everytime a buyer encounters a hurdle, that is one jump closer to the deal falling over. Your goal should be to limit the hurdles.
Other factors that could affect the overall sales price of your business include if the business can be easily relocated if needed (ie. is it a business that must be conducted in a certain place, such as a central office, or can it be moved to suit the buyer’s needs.
Of course, Holmans can assist you prepare your business for sale and help you evaluate the above. Ideally, you should be liaising with your accountant at least 2-3 years before any intended sale.
Need assistance and want to know more?
Contact Holmans today;
Holmans Noosa: (07) 5430 7600 or email info@holmans.com.au
Holmans Maroochydore: (07) 5451 6888 or email infohm@holmans.com.au
