3 Practices to Get Your Business Ready for Sale

Get ready

To sell your business

Are you looking to sell your business? Read through to learn a couple of things you'll need to do to get it ready for the big sale.

Let’s get your business ready to sell

A record number of businesses were sold in 2018. Four percent more businesses were sold that year than in 2017. 

Selling a business is a lot like selling a home. It's something you've put a lot of blood, sweat, and effort into, and it takes time to prepare for an exit that makes it all worthwhile. 

More often than not, your employees can't come with you once you've sold your business, and that alone can make selling a business rather bittersweet and difficult when it comes to making sure they stay on board with a new owner so you can get through a successful exit.

If you're wondering how to begin to get a business ready to sell, we can help with that. Keep reading to learn our three ways to start the process of selling a business. 

1. Get a Business Ready to Sell by Boosting Your Brand

The more brand awareness you have, the more valuable your company is to potential investors. Here's how to boost your company's brand:

Appearance

All your marketing and branding efforts should have a consistent and attractive look to them. 

Visibility

Customers and buyers alike should be able to find your company online. Make an effort to get your website ranked first on searches. 

Integrity

Clean up any problems your business has going on. That includes any scandals, lawsuits, or scam reports. 

Potential buyers want to know you and your business are honest. 

Followers

You can't just post every once in a while on social media. You must have an active profile and accumulate followers. 

The more customers who are loyal to your brand, the more successful your business becomes. And buyers are purchasing not just your office space and products or services, but your customers as well. 

2. It's About Timing and Knowing Your Worth

Get an appraisal done on your business. You'll not only know the real worth of your business but prospective buyers will want one done anyway. 

But selling a business is all about timing. While you may think you need to sell because your business has legal challenges, is facing bankruptcy or is losing too much money, you'll also attract buyers eager to cash in on your distress. 

It's better to sell when your business is doing well. It's appealing to investors and you walk away with more money in your pocket. 

3. Keep Costs Down

The more costs you can cut, the more profits you'll make. And the goal as a seller is to show buyers a revenue trend that's ticking up instead of down. 

Take a look at your current expenses and find ways to either reduce them or eliminate them entirely. Often, all it takes is a quick phone call to your vendor to ask for a better deal. 

Cutting costs can help show buyers that the business is improving rather than slowing down. 

Get Help

Another way to learn how to get a business ready to sell is to partner with the right business broker. We can help match you with the best professionals for you and your unique business when the time comes.

We'll also help explain the process and be there with you every step of the way. Click here to learn more. 

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PREPARING TO EXIT YOUR COMPANY

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THE BIZNEXUS ROUNDUP

Quick & dirty interviews, war stories & tips from the trenches of business acquisition, growth & sale. We aim for value, efficiency & fun, so you'll walk away with something useful to take with you along the journey of buying, growing & selling a business.

Factors That Influence the Business Valuation Formula

factors That Influence the Business Valuation Formula

To truly gain a profit, though, you must fully understand the value of your business.

When estimating the value of your company, there is a myriad of key factors that can substantially impact the business valuation formula.

Business valuation formula

What if a single error ruined the biggest sale of your life?

Many entrepreneurs work hard every day to turn their business into a success. The ultimate goal is typically to sell their successful business and reap a significant profit.

To truly gain a profit, though, you must fully understand the value of your business. And that means understanding what actually goes into a proper business valuation.

Wondering which factors impact your business valuation? Keep reading to find out!

Room to Grow

When someone buys your business, they are not buying what it currently is. Instead, they are buying what it has the potential to become.

It is important for your business to have growth prospects and opportunities for easy expansion. These help boost your brand in the here and now while showcasing your full potential to prospective buyers, especially if your company is young.

This is why analytics should be at the heart of any growing business. You can have your finger on the pulse of emerging trends and tailor your business to changing demographics and tastes.

Financial Performance

Growth potential is only one part of the valuation formula. Potential buyers are also interested in your past financial performance.

Put simply, it's tough to project future potential if your business has been bleeding money. Conversely, if you've steadily turned a profit for the past 3 years or so, your business will seem like a stable and steady investment.

Ultimately, this is why it makes sense to try to sell your business when it is at its peak performance and you have the financial records to prove it.

The Competition

A buyer inherits more than your future prospects when they buy your business. They also inherit all of your competition.

Make no mistake: buyers want to know what your competitors are like. This includes both the size of the competition and their overall numbers.

For example, if your market segment has a handful of large competitors, that can be a bad sign. It means that a buyer may have an uphill climb against well-funded and well-established competition.

If the segment has mostly smaller competitors, though, this can be a good sign. It means that these smaller businesses will be easier to take on as the business grows.

Business Location

Certain parts of the business valuation formula are set in stone. For example, the business location is just as important as ever.

A business designed for hip, urban millennials may not be a hot seller if you're located in a rural area. And even if the business is a perfect fit for the area, a buyer will pay special attention to rental costs and other overhead expenses.

No matter the business, an affordable location with easy customer access will always be highly valued.

Business Valuation Formula: Your Future Awaits

Now you know the most important aspects of the business valuation formula. But do you know who can help you sell your business?

We specialize in every aspect of business sales. If you want to see how we can electrify your sales chances, try out our BizNexus service today!

BizNexus -Learn More From Our YouTube Playlist:

PREPARING TO EXIT YOUR COMPAN

Have you checked out our podcast?

THE BIZNEXUS ROUNDUP

Quick & dirty interviews, war stories & tips from the trenches of business acquisition, growth & sale. We aim for value, efficiency & fun, so you'll walk away with something useful to take with you along the journey of buying, growing & selling a business.