If you want to sell a business, it is crucial to understand why you want to sell and when. Selling a business requires planning. It is beneficial to have a business valuation conducted by independent party. This will provide an objective assessment of what the business is worth. Such a valuation will bring issues to the surface, both good and bad. These are the questions the buyers will want to know about.
A business plan is also recommended when selling. Part of the business plan will include the business's strengths, weaknesses, opportunities, and threats. This shows that the business was built with goals in mind and a plan for the future. The business plan is a great selling point and can help assuage or alleviate worry from potential buyers. It illustrates the business owner's professionalism and planning and provides a map or game plan for the business's growth.
A marketing plan in particular should be included when you try to sell a business. Advertising and marketing are the cornerstones of any business growth. If you can show potential buyers that you have a proven plan for successfully marketing and gaining new customers, then your business will be in greater demand to buyers.
Once the valuation has been conducted, the business will be attractive to potential buyers if, over time, the business is solidly profitable and generating free cash flow. Many of these in demand characteristics that should be in place when you want to sell a business may not be there for a few years. For this reason, it is ideal to prepare the business for sale. The depth and experience of management, long term customers, and profitability during recession are some of the strong suits of a business that people will want to buy. Some common mistakes made when people try to sell their business are having an unrealistic expectation of the business's worth.
No matter how expert you are, it is not good idea to handle the sale of a company on yourself. Hire an expert. A business broker is skilled in selling process and is often paid by the seller on successful sale of the business. It's important to involve an experienced team of professionals in sale process. The team should include a business broker, accountant and legal advisor.
To summarize, if you want to sell a business, make sure to have a valuation conducted. Next, be realistic on the asking price and base it on the objective valuation. Have a business plan with a marketing plan. Assemble the team of experts. Remember, selling a business is one time phenomenon. Preparing business for sale is key to successful selling process.