Setting Your Business Up For Sale

All business owners look ahead to the time when they retire and hope that they will sell their businesses swiftly, painlessly and, most importantly, profitably. After all, what’s the point in spending all the years of hard work, sleepless nights and making sacrifices building the business when you don’t get what you deserve?

In the current economic climate the press would tell us how hard the times are and that the future is far from bright and orange; whereas the governments are trying to assure us otherwise. Perhaps there is a good lesson to be drawn from the recession is that the strongest and well organised survives. If you are a business owner and managed to see your business through the recession, then huge congratulations to you! You have done well and far better than some of the banks and corporates world-wide.

However, regardless of who tells us what, we still hope that we will find that buyer who will make us happy and we won’t need to worry about a thing when we sell our businesses because we know that a) our business (that we worked long and hard for) is in good hands; and b) we get the price that we deserve for all the sacrifices that we’ve made over the years. We also hope that we sell the business whenever we like and without a glitch. Sadly, the reality is usually far from it. The world is overcrowded with organisations that are willing to “help” and promise retiring vendors the Earth and overvalue their business whilst waging a bidding war while we wait (for months and years) and pay tens of thousands of Dollars (Pounds, Euros and Yens) for the privilege.  However, most vendors are disappointed when they sell their businesses because they don’t get what they thought they would (or what they were promised).

The good news is that it doesn’t have to be this way! There are a few simple steps any business owner can take in good time to ensure that they exit their business comfortably:

1. Get an early business valuation done to identify an indicative price for your business and areas for improvement.
2. Build a strong management team.
3. Ensure that you have M&A (Mergers & Acquisitions) specialists (lawyers, accountants, and business advisers specialising in business disposals) on board early in the process. No-one can help you once it comes to signing on the dotted line as it may be too late.
4. Look for direct buyers and don’t just rely on brokers.
5. Be realistic about the price of your business. Ask yourself a simple question: Would I, knowing all about my business that I do, pay the price that I ask for it?

Also consider some deferred consideration when selling your business. After all, it is not very often that business owners get the full asking price up-front. There could be more benefit in part-payment up-front and part-deferred.

If you would like to investigate whether Luminar International may wish to buy your business, then contact us.

Luminar International
http://www.luminarinternational.com/
info@luminarinternational.com