Selling a business is a significant decision that demands thoughtful consideration. Before putting your business up for sale, examine the factors involved in a sale. Here are 10 important considerations when selling a business:
- Consider your next step first: Before starting the selling process, think about what you’ll do after the sale is complete.
- Evaluate personal and business readiness: Ensure that you, your business, and your team members are ready before finalizing a deal.
- Weigh opportunity cost against life goals: Consider what you’ll lose by selling your business, including growth opportunities and how the sale will affect your career or personal life.
- Show the true value of the business: Assess your business and accurately determine its value to ensure a fair purchase price.
- Evaluate multiple potential buyers: Consider the bid price, the buyer’s intended use of the business, and the purchase terms.
- Maintain empathy and perspective: Don’t take a business valuation personally if the results aren’t as expected.
- Remember that people don’t pay for potential: Don’t reject an offer based on the business’s future performance.
- Don’t focus solely on the purchase price: Consider salary guarantees, stock payouts, installment payments, future ownership stakes, and various sale provisions.
- Ensure your values align with those of the new owners: Find a buyer who will maintain the business’s quality, brand, and mission statement.
- Help employees transition: Develop a deal that benefits your employees. If that isn’t possible, support them during the transition as much as possible.
While it makes sense to consider selling a business during increased buyer demand and potential for higher taxes, timing market conditions is difficult. Carefully evaluate all factors before deciding to sell. By considering these 10 key factors, you’ll be better prepared to make the right decision for you and your business.
Buying or selling a business can bring many rewards, but there are many factors to consider, including market conditions, pricing, and business financing. AARE business brokers are experts who can assist you with every step of your journey. For more information, visit AARE online at aare.com.