Many business owners struggle with questions regarding selling their businesses. Even those close to retirement age wonder when to begin considering putting the business on the market. A business is an immense investment that takes owners years of effort, a significant amount of trial and error, and millions of mistakes to build up and nurture to success. Seeking the advice of experienced business brokers is a great place to start.
The Valuation Process
A broker can complete an accurate valuation to determine what the business is worth and make suggestions for changes that will increase the asking price. The total worth is based on both tangible and intangible factors of the business. Annual revenue, location, the size of the customer base, current debt, and assets are a few examples.
That information alone can help owners make a decision one way or another. If a business is worth more than the owner imagined, it may be time to sell. Other owners will decide to keep the business, make some changes, and consider selling it in three to five years.
Another valuable service of business brokers is marketing the business in the best way to maximize the selling price. Highlighting the positives and presenting a potential for growth will attract serious buyers. Reaching an extensive pool of interested buyers is also part of marketing. Brokers will know what type of buyers will be most likely to purchase particular businesses. Capturing their attention can reduce the time the business spends on the market.
Some business owners do not want their identity to be public knowledge when the business is on the market. Utilizing a broker ensures confidentiality if desired. A business for sale may cease to attract new customers, which will affect revenue, and fail to increase the customer base for potential buyers. Depending on how long the business remains for sale, a declining number of customers can dramatically affect the sale price.
Consult a broker to explore options and possibilities when it comes to deciding if it is time to sell the business. Knowing all the contributing factors to a successful sale and learning the value of the business is a benefit regardless of the final decision.