Selling a business is a complex process. At the heart of the matter is finding the right buyer. In a Forbes article titled, “Ready to Sell Your Business? Follow These 3 Tips to Find the Best Buyer,” author Serenity Gibbons outlines that selling a business is a multifaceted process. Here are a few key variables involved in selling a business:
Have a coherent and well thought out exit strategy in place.
Gibbons points out that at the top of your “to-do” list should be selling your business the right way. This means having a great exit strategy in place. Many experts feel that when you first open your business you should have an exit strategy.
Only a low percentage of businesses on the market actually find buyers.
According to Gibbons, only an estimated 20% to 30% of businesses on the market find buyers. This means that business owners are vulnerable if they can’t sell. Business owners usually have a large percentage of their wealth tied up in their businesses. It is vital for business owners to make their businesses as attractive as possible to buyers.
Have your business ready for your exit.
In Gibbons article, she point to author Michael Lefkowitz’s book, “Where’s The Exit.” This book outlines what business owners need to do to their business ready for exit. Some of the topics covered are updating your books, ensuring that a good team is in place and ready to go and taking steps to “polish the appeal of your brand”.
According to Gibbons, a business owners needs to address these three things when looking to find the right buyer:
- consider your successor
- explore your broker options
- find a pre-qualified buyer
She notes, “Not every buyer with cash in hand is the right buyer for your company.” Gibbons supports the fact that working with a business broker is a smart move.
EBIT Associates can help you plan your exit strategy, help you get your business ready for your exit and help you find the right buyer. We sell over 75% of our client companies at a higher price than the broker community.