I've invited friends from Sunbelt Business Brokers to share some of their thoughts and expertise that we feel may be equally valuable, whether you're considering buying or selling a business. Please feel free to pass this post along to those you feel may benefit from this information. And we're confident that these seasoned business professionals would be pleased to speak with you regarding your requirements, just as we'd be pleased to work with you through your business planning, development, and business financing needs. Please enjoy this guest blog post.
The Secret of Selling Your Business
And Getting What It’s Really Worth
Are You Ready to Sell Your Business?
by Dale Alton
Have you ever thought about selling your business?
Letting go of the business you’ve built takes careful planning and serious consideration of the financial, legal, tax, lifestyle and emotional issues you’ll be facing.
You may find yourself thinking about this significant transition with the realization that you have lots of concerns about it. You’re not alone. Many business owners have not fully considered an exit strategy that is the best for their situation.
What many owners fail to understand is that, starting this process three or more years prior to selling your business is one of the best ways to maximize your after tax dollars.
They say that “experience teaches”. Tough to get the experience you really need to sell your business if it is the first and only time you expect to do it! Experienced serial entrepreneurs will often use a business broker because of the advantages they know that a Broker offers.
Every deal is different. A business broker, working with a strong network of other experienced brokers can be key in ensuring you find the right buyer and receive the best after tax dollars on the sale of your business.
A good business broker will work with your lawyer and accountant to bring order to the process and help ensure you get what your business is worth. Do you know the buyer is probably more nervous than you about whether she/he will be getting a good deal. Sunbelt Business Brokers has found that, in the end, creating a win/win between the buyer and the seller is a great way to get you the best return.
Planning and Preparation are Critical!
So what are some of the key considerations that will affect the success in selling your business? Your after tax proceeds may be a pretty good determiner on how well you feel you did. A smooth transition and ongoing success of the business is often another major consideration. The attractiveness of your business in the marketplace, proper planning and preparation, and the execution of a business sale agreement will make a significant difference in the outcome of the sales process.
Preparation is discipline that can be tough to see the advantage of in the day to day hustle of leading and managing your business. With so many goals and objectives it can be difficult to see the end game. What will you do in the end to monetize all of that hard work you have put into your business? The added challenge is that life is unpredictable. One never knows when death, disability, divorce or just another really good opportunity may make selling your business a necessity.
You are already probably working with an accountant and lawyer. Most of them make their money doing some pretty specific things in your business, and may or may not have the experience you need to get you over the “finish line” when looking to selling your business.
A business coach, independent financial advisor, insurance professional, and business broker can all be potential members of a good team to help you strategically increase the value of your business, manage your potential risk of loss and/or get the best financial return.
The Boomer Bubble Impact
To ensure that you will put the most after tax dollars in your pocket after selling your business you first need to get the best price. So what trends might be affecting you that you do not have control of?
No one can time the market. Oil prices can wreak havoc on sales, but the cyclical nature of the market actually can work to rationalize a fair price based on the anticipated rebound and income potential. One cycle that we all know about, but may still hold a few surprises, is the baby boom.
Research indicates that in the next five to ten years, Baby Boom entrepreneurs will be retiring in record numbers. It is anticipated that 70% of privately‐held businesses will change ownership during this time.
Never in history has a change in small business ownership of this magnitude occurred. That means that if you’re a Baby Boom entrepreneur, you may be selling into a very competitive marketplace. It’s likely that only the most attractive and well‐prepared businesses will sell for what they’re worth. It is also inevitable that many profitable businesses will not sell unless they are well prepared.
It is expected that by 2018 we will see something new that will be influenced by this trend. The market is predicted to move from a seller’s market to a buyer’s market for a large number of main street businesses. Businesses that are well prepared and ready to compete in a buyer’s market will fair best in that economic climate. Preparation and timing are critical to getting what your business is worth.
In a series of articles we over the next few months, we hope to provide you with valuable insights into the process of selling your business. We invite you to contact a Sunbelt intermediary for a complimentary consultation about how you can achieve optimum success in selling your business.
You will want to understand and take control of the factors that affect the value of your businesses and to constantly build for maximum return on investment. Every step you take to prepare your business for sale will also ultimately create a more enjoyable and more productive business environment. It will also ensure that you’re ready when the right opportunity comes along.
In the next installment “20 Ways Business Owners Mess Up When Selling Their Business” we bring you a 3 part series that provides suggestions on how to meet many common challenges for owners looking to sell their business.
How do I Determine My Goals in Selling My Business?• Define and thoroughly evaluate your reasons for selling
• Consider the alternatives to selling
• Determine if selling is indeed your best option at this time
• Work with a financial planner and tax lawyer to structure optimal transaction strategies and your best approach to managing the proceeds of the sale (ask your Sunbelt intermediary for recommendations)
• Determine if the proceeds of the sale will provide the funds you require to sustain your lifestyle
• Evaluate your optimal terms and conditions for sale (your Sunbelt intermediary can help)
• Determine the best possible timing for you:
- Are you ready for your retirement?
- What will you do once you sell your business?
- How does your family feel about selling?
- Will selling satisfy your financial needs for retirement or other pursuits?
- Are you interested in continuing to work in the business?
- Do you plan to buy another business?
Sunbelt Business Brokers EdmontonSunbelt’s team of brokers, operating at local and regional levels, have experience selling small to medium sized businesses.
A variety of strategies are required to sell businesses from different industries, of different sizes, and in different economic climates. Many Sunbelt brokers have specific industry experience and cooperate with their counterparts to identify the buyer and create the right framework for the sale.
Your Local Sunbelt Business brokers sell a diverse mix of main street businesses valued under $3 Million. Mergers and Acquisitions of larger and more complex business transactions of up to $30 Million are managed out of the Ottawa Head Office. We would like to help you plan and look forward to retirement, expansion or an exciting new business opportunity.
Have you ever thought about selling your Business?Sunbelt represents clients who may be interested in buying a business like yours. If you are thinking of selling a business now or in the next 3 years, discover what your next steps should be. Feel free to contact our Sunbelt Business Brokers Edmonton office if you have any questions or would like a free confidential consultation. Give me a call. Dale Alton – 780-878-8787
Sunbelt - The Place to Buy or Sell a Business.
NOTE: For a closer look at the services provided by Pro-Vision Solutions Inc. and how we can assist ... visit our Website: www.pvs4u.ca
AND, we invite you to add your comments or additional helpful suggestions for entrepreneurs. Please let us know your thoughts and feel free to share this with those in your circle of contacts!