Selling a business can take several months and is a lot more complicated than selling a house.
Ideally you should start preparing your business for sale 2 or 3 years before going to market to help you get the best sale price possible.
United Business Brokers are experts in selling small to medium sized businesses and can provide you with a number of tips to increase the value of your business.
- Sack yourself! Well not literally…but make the business less dependent on you. Delegate more responsibility to your workers so that a buyer can see that the business can run without you
- Systems and procedures – Automate as much as you can electronically
- Record keeping / database – Use MYOB, Xero, Quick Books or similar. The reports that these systems can generate can be powerful and give buyers a clearer understanding of your business Look at your expenses – Start cutting out non-essential and personal expenses to improve the bottom line
- Don’t put all your eggs in one basket – Making a net profit of $1 million a year is great, but if it’s all from one client then it’s a risky purchase for a buyer.
- A business that makes $1m a year from several clients is a lot more valuable
- Offer to stick around – Let the buyer know that you’re happy to assist them for a few months after the sale and they will feel a lot more confident making an offer
- The “C” word… CASH – In short, if it’s not on your income statement (P&L), then it doesn’t exist in the eyes of the buyer. If you want to improve the value of your business, put everything through the books