There was a study done, years ago, that showed that the reason businesses were for sale had a direct relationship to its probability of sale.
Reason for Sale
%Reason for Sale
%Probability of Sale
Retirement
10-15%
30-35%
Health Problems/Death
15-20%
25-30%
Partnership & Family
Problems/ Divorce
5-10%
15-20%
Burnout/Other Business
Investments
15-20%
15-20%
Under-capitalization...Read More
Many people who are selling their business think that once they find a buyer, the business is sold. Unfortunately, the real work is just beginning. Once a buyer is interested, there are the inevitable questions that must be answered. After the questions are answered and the buyer has satisfied himself or herself that the financial aspects of the business are satisfied, the buyer is probably...Read More
Prepare for new management. As soon as you make the decision to sell, begin doing what you can to help the business run “on its own.” The business should not, especially now, be just you!
Accept the financing facts. You’ll likely be financing the sale of your business, since banks are traditionally unenthusiastic about loans for the purchase of most businesses.
Make sure...Read More
Selling your business is a major decision! You have devoted your time, money and energy to building, running and operating your business. It may well represent your life’s work. You have decided that now is the right time to sell, and you want the very best professional guidance available. This is when working in tandem with a professional business broker can make the difference between...Read More
If you’re considering selling your business, and you are employing a professional business broker or intermediary, it’s imperative to be absolutely open with him or her. This is not the time for secrecy — or even for subtlety, especially when it comes to problems. If you’ve been having trouble with your lease, one of your best customers or your fixtures and equipment,...Read More
1. Not knowing what the business should sell for
One of the most costly errors a business owner can make is not knowing the approximate price of his or her business prior to entering the selling process. Although the marketplace ultimately determines the final price, an owner needs to know what the approximate price his or her business is prior to placing the business on the market. Before...Read More
Buyers Want Cash Flow
The first thing to keep in mind is that the vast majority of buyers want to buy cash flow. Sit down with your accountant or bookkeeper and begin to get your financial statements in order with cash flow the order of business. Cash flow is not the same thing as profit. Most buyers look at the profit and loss statement or tax return, and look at owners or family...Read More
Do have all of your business documentation ready. Everything starts with it.
Don’t underestimate the value of your business. Owners of privately held businesses usually minimize profits to lower taxes. The financial statements may not reflect the real value of the business.
Don’t overprice your business. The right buyer who is willing to pay the right price may not even want to...Read More
Some of you might remember the commercial for one of the major airlines in which a business lost a major client, because they never saw anyone from the company. The president handed out airline tickets to the entire sales staff so they could go out and visit the customers. When asked what he was going to do with the remaining ticket he replied that he was going to go see the lost client. And,...Read More
In the day-to-day activity of making a business work, many owners overlook the importance of the buy-sell agreement. This document (also referred to as a business continuity agreement) is like a will; no one thinks about it until it’s too late. However, it may just be the most important written agreement or document you ever create.
If your business has more than one owner, either...Read More