Steps 3 & 4: How to prepare for a successful business sale

3. Is this the right time to sell?

There is no magical ‘right time’ to sell. In fact, a business should be ready for sale every day it is trading. 

 

It’s the wrong time to sell when:

• you are making Low or No Profits 
• you have no clear plan for yourself when you actually do sell
• you make emotion-based decisions
• you are having trouble with staff
• the gap between your NEED PRICE and estimated NETT CASH OUT is too large
• you are experiencing health or personal family reasons

 

4. What do buyers look for? 

The number one reason a buyer looks to purchase a business is that it allows them to progress in life and put their future in their own hands.

Buyers can be split into three general categories:

Buy a job (most transactions under $250k): These buyers focus on earning capacity and lifestyle are looking for security, longevity and, potentially, the ability to scale up later on. 

Private buyers / Investors (most transactions $500k-$15mil): All private investors want a business that will give them a greater return than their other potential investments.

Corporate / Company Buy Outs (Transactions $1mil - $20mil and upwards): Companies generally buy established companies with full (or close to full) management structures in place. They focus on strategic purchases that offer access to new markets, new customers and products or services (typical of competitor buyouts)

 

What sort of buyer would be attracted to your business? 

If you are thinking of selling, now or in the future, take our saleability test to see where you and your business stand. Every business owner should have a clear exit strategy - start to plan yours now. Evaluate your Business Saleability Score