Selling a business is one of the exit strategies that small business owners may endeavor to ultimately plan for. It gives business owners a chance to retire and leave their business, but make a profit off of it and leave it in trusted hands. However, disposing of a business in the market is not as easy as it sounds. It requires sufficient due diligence, planning, and time to perfectly execute. To get value for your business by selling it, you should endeavor to focus on four particular areas during the sell-off.
Prepare an exit strategy
The first important step to take is to come up with an appropriate exit strategy of how you, as the business owner, anticipate leaving your business. The strategy should contain important information such as the anticipated date or deadline of selling the business, what you intend to do with the proceeds from the sale of the business, how to hand over the existing assets, liabilities, and capital among other important areas. The strategy helps guide you through the entire process to ensure that you do not leave anything undone.
Conduct business valuation
The second key step to take is to conduct a thorough, and preferably third-party, evaluation of your business to determine the actual net worth of all assets and capital. A comprehensive business review and valuation should provide an overview of all relevant areas such as sales, receivables, inventories, assets, debts, liens, and any other information or area that affects the business’s value.
Comb through your business’s financials
One of the factors that may affect your ability to sell your business in the market today is the status of your business’s financials. You may want to invest as much time as possible preparing for the sell-off by conducting a thorough evaluation of every transaction conducted in the past. You should pay attention to suspicious transactions which may raise eyebrows among the prospective buyers.
Boost your business’s net worth
When selling your business, you should focus on fetching as much return of your investments as possible. One of the key things you can do to boost your business’s net worth is by investing a little to help boost the business’s sales, preferably a few months to a year before the actual sell-off. The prospective buyer would be attracted to offer a higher price for your business if your sales are relatively stable and appealing.