Were you approached to sell your business or are you locking out for potential buyers? If ‘Yes’, then this is exciting. You can look for lots of personal and professional opportunities through this sale.
Owning a business can be one of life’s greatest pleasures or one of its greatest banes. There are some indicators that can point an owner to realize that while it may have been a good run, or in some cases one long, bad run, it’s time to get out. Ignoring the indicators will run your business in to the ground. Getting out in time, however, can save time, money, and sanity.
If a time comes when your business begins taking a toll on you personally, be it your health, your marriage, or personal relationships; when everything around you begins to deteriorate and it looks to others as if work and your business is the most important thing to you, you may consider that you’re in over your head. When the most important people in your life come to you and express their concern for your mental or physical health, it’s time to take a look at getting out while you still can.
Find a trustworthy Advisor
If you have a business with a large amount of inventory that is sitting in storage and not moving, it may be an indication that your market has gone dry. This problem can possibly be solved by structuring a new promotional campaign, looking to new items to invest in, or reshaping the entire business. Unfortunately, it can also be an indication that you’re the wrong owner for the business.
Are you really determined to sell?
A determining factor in selling a business should be whether or not you still have the passion that you had at the time when you first thought about building your business. Try to think back to that time when your business was only a thought. See if you can remember what you felt inside about it, and ask yourself if those feelings still exist. If the old flame is no longer burning, it might be time to move on to other things.
It’s not a simple decision to sell a business that you’ve poured your heart and soul into, but in the end, a profitable sale may hinge on being able to read the market as well as the special indicators that it’s time to get out.
Don’t take up anything until you have signed off the last contract:
This may sound cliché but as the saying goes “never count the eggs in the basket before they hatch”. There was a business man who had a deal to sell of his business for $10 million , only to find the buyer vanished at the last minute.
The seller had to slog for another six months to finally seal a deal after a deep and intense due diligence. Getting the first step done is very crucial and this may even be a mere signed letter of intent from the buyer. However this really doesn’t tell you that the deal is closed, there is a lot of stuff you need to do before you finally close the deal. What do I advise? Keep your company buzzing until the very last minute.
Do you know what’s next? If ‘No’, then it is high time you figure out.
During the entire process of selling, you would definitely be focused on all the paperwork and once the deal is through, What’s next? You go on from a point where you were on a mission and now you just don’t have any missions on your list
After the sale once many business owners move from being a small company to being a small subsidiary within a larger organization. These shifts could be smooth sometimes or could be a disaster in many instances.
Think before you surrender your autonomy. What is that you would want to do once you have sold out your business? If you plan to be in the company without preserving the autonomy you held previously, you need to be sure you are perfectly fine with it. In case you are sure of an exit then you should look out for avenues where you could invest. Few examples can be start a new business, get involved in volunteer work or invest in other businesses. You need to be sure you have mission once you exit.
Find someone who is as passionate as you
For a business to thrive and remain healthy, it will usually require that money is invested at intervals. This money flow should come from the company’s profits, but it also might come from acquiring new loans or finding investors. If your business has found itself at a point where the money flow has come to a standstill, it is a good indication that the company has lost its ability to grow or thrive. When you cannot fund the growth of the company any further, it is a good time to get out.
Running a business should at its best be enjoyable, and at its worst, at least tolerable; however, if you’ve gotten to the point where you dread going to work every morning, or the work itself makes you miserable, it’s of no use to stay with the company or keep it going. A successful business at the expense of your happiness is of no worth to anyone, especially yourself.
If you have built your company up so that it can run effectively without your presence for several days in a row, it’s a great sign that it can be marketed for sale. It is far more difficult to sell a business that has been built around the CEO and his presence.
Do you think you’re on the top and wish to start something new?
If an investor or buyer comes along who makes an offer for your business that is above the projected valuation of the company, and you are certain that you have valued it correctly, it’s time to take the offer and move on. If this is the situation for your business, spend some time and money and have the business professionally appraised before you make a final decision.
If you are the sole owner of a company and do not have an heir or other person who can take over the company for you, and you are ready to retire, it would be better to sell while your business is thriving and you are young enough to enjoy the benefits of the sale. If you wait for a time when you are ready to retire, you may not be able to sell as quickly as you’d like to.
It’s always considered to be a good time to sell a company that is on a growth spurt and making money. An indication to sell need not always be that something is going wrong, it may well be that everything is going right and the business is showing a profit. Not only would the company be considered highly marketable at this time, but you can never tell when things may turn around. It is far better to sell while your company is a sought after commodity, than to wait until a shift in the market occurs and what was once a money-maker is now just another business in the market.
Keep in mind that not all business sell for a profit. Going into business is a hit or miss proposition. Often it is better to take a loss than to take a bigger loss down the line. If you see that your company is on a downward spiral, get out while you can still get something for it. There may come a time when you won’t be able to get anything for it.
Get your books in order before you venture out selling your business
You must be thinking that probably only the bankers evaluate your financials wait until you meet a potential buyer. You’ll be amazed at the grain a buyer may evaluate your business. So, if you’re planning to part with your company you might want to keep your financial statements up dated. Make sure you have an impeccable tax returns filed. Usually more your tax returns, more would be your company’s valuations. This could be a bit complicated since you have tried to reduce your tax bills each year.
