Many business owners are daunted by the prospect of selling the company they have invested years into developing. If you are selling a business for the first time, you may be a little inexperienced and unsure about how to proceed. Read More
Every entrepreneur running a successful business has pondered about the possibility of cashing out and moving on to the next venture. Today, the market demand for new businesses is quite high. Therefore, it is easy to sell your business in 2016.
A Price Too Good to Resist
A ready market provides the perfect opportunity for a business owner to fetch a higher price for their enterprise than it is actually worth. Given that such sellers markets do not last forever, cashing out may be a good idea. In addition, one may use the excess capital accumulated to start a new business.
Looking for New Opportunities
Entrepreneurs are always looking for new markets and unexploited opportunities. While starting out and growing a business is exciting, staying on one venture for too long eventually makes entrepreneurs lose interest in it. Furthermore, selling when one does not need to often fetches to a high price.
Many people run successful businesses for many years until their old age. While others start their own ventures so that they may retire early and have time to enjoy other interests. Retirement allows people to plan for their lives and enjoy the fruits of their labor.
Tired of Risk Taking
Owners who start a new business are often less afraid of risk since the venture is still small. However, once the venture has grown, the longer one stays in business the more risk they face. So selling is a viable option in 2016.
Here, the owner sells a large stake of their business and retains a small equity stake. The owner helps in transitioning the business, and increasing its value while their management role diminishes.
There are many good reasons to sell your business this year. Once an opportunity comes up, it is advisable to seriously consider taking it up.
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It may be difficult to find a prompt buyer when you’re attempting to sell your business. There are numerous reasons why people who own a business may want to sell it as soon as possible. Some people are born entrepreneurs, not managers, and may want to convert their business into cash as soon as they wish to pursue another project. Some people want to stop worrying about their business, and start to do other things in their life; which makes selling the business for a lucrative price an ideal situation. Others may need a quick influx of funds for a financial emergency, and selling assets like a business is a good way to obtain cash. Regardless of the reason, selling your business should not be a decision that is taken lightly.
One of the best ways to sell your business quickly is to offer it to your competitors. Companies in your niche may want to expand their operations, and buying out a competitor is an opportunity few would fail to consider- especially if you sell your business on a high note. They may or may not want to continue operating your business, but the prospect of acquiring machinery and equipment, as well as taking over an existing client base is something ambitious companies would love to take a look at.
You can also sell your business as fast as possible by seeking the services of skilled brokers. These professionals can help connect those who wish to sell their businesses with people who have the money to invest and acquire business opportunities. This can be a good way to get the word out and hopefully attract prospective buyers, not just within your local region, but from other parts of the world as well. Brokers and professionals can also be indispensable in providing help and advice with the processing of documents to speed up the business transaction. Need to sell your business?
If you are planning to sell your business, there are a few things that you’ll need first, in order for a broker to effectively help you find a buyer. Moreover, if you don’t want it to be on the market beyond three years, you should follow these tips.
Tip 1- Hire a Broker
If you are planning to sell your business, you should definitely hire a business broker. This will free up your time so that you can keep things running, while you have someone handling the sale. If your business is running well, you will have more interested buyers and could sell it for the highest price possible.
Tip 2- Verbalize Your Reason for Selling
The first thing that potential buyers will ask is why you are selling your business. For some, the reason is retirement, partnership disputes, illness or death, feeling overworked, or boredom. For others, the reason they are selling is because the business is not as profitable as they would like, or they cannot attract customers. Because these issues can make it difficult for you to sell your business, you may want to do what you can to increase profits, produce consistent income figures, and expand your customer base before putting your business on the market. This could also take time, but timing can be very important.
Tip 3- Business Valuation
It is important to know how much your business is worth so that you don’t price it too high or too low. Also, when you have the business appraised, you will have a document that will bring credibility to your asking price.
Tip 4- Gather Your Documents
When selling your business, your broker will need a great deal of information to show potential buyers. You would need to gather financial statements and tax returns that date back three or four years. You would also need to list equipment that is being sold with the business, a list of contracts related to sales transactions and suppliers, and your current lease. You should make copies of all of these items so that you have the originals and the broker has the copies.
Tip 5- Be Patient
According to SCORE, it can take six months to two years for a business sale to go through. It is important to be patient, and trust that the brokers know what they are doing. If you expect the broker to find a buyer and complete the sale in a month, you will be disappointed.
When placing a business on the market, it’s always best to leave the selling to your broker; especially if you are inexperienced in this area. A good rule of thumb is to be prepared to supply the professionals with all of the information and detail they need. The more prepared you are, the faster you will sell your business.
Most businesses face tough challenges and choices when the economy is in a slowdown. With just about everyone selling, and very few people willing to buy, it can be quite complex when you want to sell your business in a down economy.
Whether you’re a beginner, or a master salesperson, a down economy is the best time to make improvements and be successful in any market conditions. A few tips can go a long way in helping you achieve that during a slowdown.
Use Cost Effective Marketing Tools
Once you identify your target market, you must use a cost effective approach to marketing. While using cheap marketing tools might not work, you must take an approach that will bring you a greater ROI. Leveraging your resources is an effective approach to making the most out of a budget that might be limited without being wasteful. An appropriate social marketing tool can certainly accomplish this goal with lower costs and farther reach.
Focus On Your Target Market & Offer More To Existing Customers
Target marketing is a very powerful approach to optimizing time and resources. Thus, putting all your efforts into your target market will bring greater yields. If your products and services meet the needs of your customers, you must identify good selling opportunities that they might not be aware; especially during downtimes. With that, continue to offer more to them in the tune of new products, improvements, and/or value offers that save money. Going the extra mile will keep targeted customers with you, help increase business, as well as create other opportunities you never knew existed. This, in turn, keeps revenue steady, and makes it attractive for when you’re ready to sell your business.
Find A Broker
Professional business brokers can be your key to finding great potential buyers; especially during slowdowns. Brokers are familiar with various industries, and have the knack for weaving through the market to find ways to, not only prepare your business for sale, but also find those who are looking for opportunities to invest.
Join a Network
Effective networks are a powerful approach to getting more business and selling it when the opportunity affords. Any person that can help bring business your way, and you help them, should be a part of your network. Networks provide strong support systems for businesses; therefore, getting involved and working with others can help you grow, as well as find a buyer in the toughest of times.
A business broker is an experienced entrepreneur and a marketing expert. He or she is able to tap into an array of contacts and resources to help you get the best possible terms and prices for selling your business.
How do I sell my business? If this is the question confounding you but you seem to have no answers, a broker’s advice and enlightenment will come in handy. You can count on the connections, competencies, experiences, and expertise of a top business broker.
1. Weeds out the “Lookers” & Identifies Best “Prospects”
Agents are highly experienced on the different underlying issues. They have a knack for picking potential buyers who have more than just a fleeting interest in your business. A majority of people, who are asking for more information about a particular business sale, may not have a real intention of purchasing. A business broker will save you from this class of people and connect you with serious purchasers.
The broker will screen potential buyers by carrying out background checks and asking them particular questions. Prospects will be interviewed for hours to identify the best. Because of the thorough processes involved, the most qualified potential buyers are the ones who will reach the final stages of the sale.
2. Manages Emotions
The main obstacle to closing a sale may be your emotions. While running a business, being emotional about your venture will help a lot. However, during business sale, it will be a great hindrance. A broker will help to handle the emotions of the sale by assisting you to manage your expectations and clarifying your sales goals.
3. Handles Complexities
Selling your business is a complex and time-consuming exercise. Without expert assistance, complexities will bog you down. A trusted agent will guide you through the business sales process. He will handle all the complexities for you, leaving you to run your business until it sells.
4. Time Saving Benefit
Time is money. The sooner you sell your business, the better. The longer it takes to dispose your enterprise, the more things become complicated and the likelihood of selling your business at a lower price increases. A business broker will expedite the business sales process.
5. Answers All Your Questions
How do I value my business? What steps are involved? How long will it take to sell my business? These are some of the questions you will be confronted with. A competent broker will furnish you with all the answers you are searching. He will help you see opportunities and challenges.
The best brokers have solid relationships with leading bankers, lawyers and accountants. These connections will be harnessed for the success of your business sale.
Selling a business is very different from selling a house. Many people will express interest in an advertised house. On the other hand, the people interested in purchasing a business are usually few and hard to find. A business broker has market connections. This makes her the best professional for locating potential buyers.
7. Acts in Your Best Interest
The business broker you have chosen will represent your interests during the sale of your business. He will do everything possible to help you achieve a good price. A certified broker will take time to learn the mechanics of your business in order to best serve your interests.
Which professionals do I need to sell my business profitably, seamlessly, and quickly? You need a team comprising of an experienced business broker, a CPA, and an attorney. A business broker is a business transfer expert who will leverage many years of experience to help your business fetch a higher sale price.