Simple Ways You Can Prepare Your Business for Sale

The hope when we start a business is that it will provide for our families and allow us to enjoy meaningful work. This doesn’t mean that we will keep our name on the doors forever. Life changes, and it sometimes makes sense to sell your business and move on to other projects (like retirement!). We hope you enjoy today’s post shared by Copper Moon Media.

Is it time?

There is no single response to this question that works for all business owners. However, a few indicators that it might be time to let go include:

• You are no longer able to keep up with the physical demands of your company.
• You have lost your passion for your work.
• You do not want to invest the funds into updates that would make you more competitive.
• You are ready to retire and do not have anyone to take over.

Preparing Your Business For The Market

Selling your business is just like selling any other major asset. You must get it prepared to make it the most attractive option on the market. To get ready, consider:

• Working on your finances. If you currently have trouble getting paid, sellers will likely be less interested in your business. Instead, improve your invoicing procedures by investing in a cloud-based invoicing tool. Not only can you automate the invoicing process, but you can create instantly payable invoices for your customers and clients. This way, they’ll be able to send you payments as quickly as possible, without having to wait for a paper copy of the invoice.
• Update your business information. If you’ve recently moved addresses or made other pertinent changes to your business, such as adding or removing shareholders, then make sure that your annual report is up to date before you try to sell. If your information isn’t current with the appropriate state board, your business license may be revoked or the next owners may stand to inherit unnecessary penalties and fees.
• Talk to your customers. You must keep the sale and potential acquisition of your business confidential until the paperwork is done. However, your customers and staff deserve to know what’s going on. Transworld Business Advisors suggest having a meeting with pertinent parties and answering questions honestly.
• Enhance your knowledge. If you’ve operated your business for any amount of time, you’re probably considered an expert in your field. However, this doesn’t mean that you know all you need to know to sell a business for the best price. If you have a few years ahead of you before you put the for sale sign on the front door, consider earning a master’s degree in business now. This will give you the knowledge to avoid making mistakes, such as selling for the wrong price. Your degree will also put you in a better position to manage your next company, as you’ll have a stronger foundation of leadership, management, and even accounting.
• Know where to sell. There are many different avenues by which you can sell your business, including through networking with current contacts or you can create a listing and sell it online through an exchange.
• Calculate a reasonable value. Knowing your business’s value is crucial when it’s time to sell. Western & Southern Financial Group explains that having accurate numbers helps buyers predict potential new sales. There are different ways to value, and the four most common are book value, discounted cash flow, revenue and earnings, and market comparison.

No matter your reasons for selling, preparation is key. You know that you need to get your offices and warehouses as in order as possible and ensure that your business is fully operational. But, there are also things you may not have thought of, such as making sure you’re being paid on time and ensuring all of your reports are filed accurately. Good luck in your next venture, and remember to bookmark Copper Moon Media for more content just like this. 

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