So you think luck and a good offer is all you need to sell a business? Actually, no. Plan ahead, and you need not depend on luck anymore. This can take about three years, which is why you should start on it now if you want to sell your business in the near future.
Even if selling your business is your ultimate goal, you cannot only focus on it; there are other things to consider as well. As stable as your business is, it is vital that you create opportunities for growth. Should you not do this, your business values will decrease and you will never find any buyers.
How valuable is your business? That depends on the rate at which your cash flows are coming in. If this is so, buyers will try to find you rather than you finding them.
Here are a few things to consider:
What’s your current market value?
Get your business evaluated and understand your current position in the market. Once you do this, you can figure out some practical options for yourself.
Work with equity backers
Instead of finding a buyer who is being supported by an equity backer, try to find an equity backer himself. Negotiate a deal with him, and not with just the buyer. Before you do this, make sure he has enough funds to make a transaction and if this is not so, find another. And by the way, we suggest you should find a number of buyers because it will create competition, which might you help in getting a better price.
Got a great employee team?
If your employees can buy your business and continue its operation, they must be completely prepared to be owners and take on the responsibilities that come with this. If any of your employees are capable of this, decide a price and a date on which you can close the deal.
The employee will be aware of the down payment they have to make, and can accordingly generate funds for it.
How big is your business? If it is quite large, you can think about ESOP or Employee Stock Ownership Plan. Doing this will allow you to buy over 30% of the stocks and provide you with some more benefits.