In this article we will discuss 5 ways that sellers should focus on the positives of their business. Many business owners fail to make a case for the benefits of their businesses to prospective buyers. Make it clear that your business has stability and ample financial health. Here are 5 ways sellers should focus on the positives of their business.
Prepare in Advance
Make sure everything is in proper order by preparing paperwork in advance. You don’t want to be scrambling at the last moment. When your records are organized and correct, your prospective buyer will be able to truly see the value of your business. Buyers will know that you have strong accounting processes that they can rely on in the future.
You should also make sure that inventory is in stock and that any necessary upkeep has been done. These updates are part of the big picture when it comes to presenting your business in the best light to buyers.
Reveal Your Methods of Operations
You will want to validate that you have a solid formula for a successful business. Buyers like to see items in place like procedures manuals. These manuals reveal the routine tasks necessary to run the business. Anything you can provide to the buyer that will help them understand how to successfully run the business will help them understand its advantages.
Keep Things Consistent
Be sure to maintain regular operations during the sales process. If prospective buyers see any kind of dip in success, it could negatively impact your deal. Selling a business is an extensive process. It can be next to impossible to handle all the associated tasks while still putting all the necessary time and energy into your business.
You will want to absolutely make sure confidentiality is maintained. A breach of confidentiality can quickly sabotage your deal. There are countless instances where a deal fell through due to a breach in confidentiality.
Get an Outside Perspective
It is hard to have an outside perspective when you are involved in the day-to-day running of the business. If you have never sold a business before, it can be hard to know what buyers will respond positively to. This is a great reason to work with a M&A advisor. An M&A advisor has years of experience knowing what attracts and deters buyers. They will help you to emphasize your strengths and minimize your weaknesses.
While emphasizing the positives, you will want to be sure to be transparent about issues affecting your business. The lack of knowledge can come back to haunt you. Your M&A advisor will work to help buyers to understand how some of these negative factors can be turned into positives once they take over the business. They can also assist you to fix some of those weaknesses before putting your business on the market.
Price Your Business Correctly
If the price you set on your business is too high, you will lost interest from prospective buyers. This is another advantage to working with a M&A advisor. They will assist you in determining a fair market value to your buyers. When the price is optimal, the strengths of your business will stand out more. It is important that you do not undervalue your business, and you don’t want to overvalue it either. M&A advisors have experience and expertise at determining the optimal price.
These are 5 ways sellers should focus on the positives of their business. If you focus on these aspects of your business, your deal should close in a timely and effective manner. The team at EBIT Associates can help guide you through the closing process. Download our FREE Seller’s Guide to help you understand the process of selling your business.