Sellers Rules of The Road
There are many reasons small businesses go up for sale. It may be retirement, owner boredom or burnout, divorce or an entrepreneur ready for the next challenge. Once a business owner is ready to sell , there are basic steps and fine-tuning to be done in order to get the best price. Here are some Sellers Rules of The Road if you're thinking about selling your business:
Keep it confidential: The process of selling is kept absolutely confidential from employees, as hard as that may be sometimes. "If you think you have a sale and it falls apart, everyone knows you want to sell," and employees may start looking for other jobs . If word gets out in the marketplace, competitors can sell against that and suppliers may change your terms.
Gather competitive intelligence: Be aware of what competitors are doing so you can show potential buyers that your firm knows the market. Review competitors' advertising and marketing materials and know what their strategy is and how it compares to yours.
Consider future growth: A buyer usually buys a business he or she believes can be improved and made more profitable. The seller should think about how the plans to grow the firm and have an answer as to why he hasn't done it. "They'll pay you for what you've achieved but they don't want to buy a business that doesn't have potential," Naideck says.
Improve business curb appeal: Make sure your online curb appeal is strong. People should Search for their company on various search engines like, Google, Yahoo, and MSN and see what prospective buyers will see.Business curb appeal also means sprucing up the physical spaces and by all means getting rid of clutter.
Deal with administrative issues: Make sure policies and procedural manuals are in place. A new owner wants a guide to run the business and will pay more for it. Update technology for accounting, scheduling, inventory, contact management or any key element to your business.
Diversify your supplier base: Many small firms do business on a single supplier relationship which can become less competitive over time. Have a formal system to have one or two back up suppliers that you keep engaged to keep everyone competitive.
Understand the value of institutional knowledge: Ensure that there will be some degree of management who knows the industry and customer relationships for the benefit of the new owner after you are gone. The business seller should plan to stay with the business for some period after the sale to affect a smooth transistion.
Download Free Tips on Increasing Business Value
It's never too early to begin preparing your business for sale even if the sale is years away. If you have any questions about the selling process, don't hesitate to contact call Bizprofitpro at 860-676-7717 so we may discuss the process further in strict confidence. You may also use the form below and we will contact you at the time and method of your choosing.
