How do I know when I am ready to sell my business?
Only you can know that but here some signs that can help you decide:
• A lack of interest in daily tasks and new challenges presented by the business
• Increased interest in outside activities
• Exhaustion from the business unrelated to a recession in the business cycle or a short term challenge
• Fear of failure combined with the lack of time to turn it around
• Clear visions of what you’re going to do next that leave no time for managing the business
NOTE: It’s best to get an early analysis (perhaps three years prior to your projected sale date) allowing you to optimize your business footprint and its results to increase business value and prospective buyer interest. This resulting data and insight will aid in developing your exit strategy, retirement plan and estate plan.
How do I know when I have found the right person or company to sell my business or business real estate?
Do they have the 3 primary qualities?• Technical competency - to point the transaction in the right direction from the outset (It’s much easier to make contract adjustments early in the process; close to the final closing can become very difficult to impossible.)
• Experience - to provide confidence, background and systems for great problem solving solutions
• Integrity - to be able to trust your intermediary’s advice when the going gets rough (The most important criteria of all is integrity. If you do not trust your advisor, you will find it difficult to consider his advice when the going gets tough. Interview prospective advisors until you find one that you are comfortable with, and who has the necessary technical competency, experience, and integrity.)I am ready to sell! What do I do next?
The best place to start is to contact us. Then you know your sales team that will get the job done. We include an experienced intermediary who manages the process and performs the sales function; a tax advisor experienced with sale transactions; and a ‘negotiating-friendly’ transactional attorney. We use our Successful Exit Process outlined on the Sellers Page.
I have a really unusual business. What is your experience with my type of business?
We have a lot of experience selling unusual businesses and hard-to-sell properties. In fact, the unusual is the norm. One example:A charming, out-of-the-way, country restaurant was on the market for 3 years with no offers. By segmenting likely buyers into different market groups and tailoring advertising to each group, we produced an all-cash buyer in about four months.
Challenges presented in selling businesses tend to be similar across most industries. The use of our Successful Exit Process allows us to learn about the unique aspects of your business and industry and then take appropriate actions to ensure you get favorable results.
I might want to keep a part of my business and sell the rest. Is that possible?
Anything is possible if it makes sense to the seller and a buyer. When a business has multiple product lines, or multiple locations, we always investigate selling the whole, the parts, or just a part; in order to produce the highest value and meet other seller needs. A recent example:The seller was a local technical services firm that provided similar services through two divisions to two distinct customer groups. Through effectively questioning buyer motives and buyer valuation techniques, we determined that the buyer only valued one of the two divisions and customer groups and intended to shut down the other division.
By working through the buyer’s concerns, and by carefully defining each company’s services and customers, we were able to convince the buyer to allow the seller to retain the second profitable division with no reduction in price. Both firms continue to be satisfied with the transaction and cross-refer clients.How much time will it take to sell?
The sales process often takes from 6 months to a year and sometimes longer. Every circumstance is different. It is important to start this process while you have the energy and interest to keep improving your business results through the sales cycle.BETTER TO START EARLY THAN LATE.
Can you help a buyer find financing?
We often help find the financing to complete the sale, since the seller’s value is directly impacted by the buyer’s ability and cost to finance. Here’s another real world experience:
The activity at a long time wholesale and retail business had slowed over the last few years along with the owner’s energy, resulting in reduced cash flow available to the buyer to use for financing purposes.We helped the buyer by recommending changes in his proposed business plan as well as cash flow changes that the SBA would approve and meet the lender’s needs. This increased the loan amount by $200,000, permittimg the transaction to proceed to closing.If you have additional questions, call Charles Scherr at ABB at 817-680-4830 or email cscherr@abusinessbrokerage.com. We answer most questions within one to two business days. Feel free to sign up for our email newsletter which includes a brief, informative article on business sales issues each month.
