SELLING YOUR business and getting a good price for it seems an overwhelming task for a business owner, especially in today’s economy. However, the California Association of Business Brokers (CABB), a non profit trade organization, says that selling a business, and getting a reasonable price for it, can happen. The devil is in the details.
The key things a business owner should do to make the business attractive to buyers are as follows: increase sales, have all financial records in order, consider seller financing, and be able to show the growth potential of the business. “While these factors are indeed key, there are other details business owners should consider that will help them be competitive,” states Ron Hottes, president of CABB. Here is what you should do:
Maintain a strong workforce. A buyer wants to know that the success of the business doesn’t rely only on you, the owner. Having competent, dedicated and trustworthy employees shows buyers that the service or product that is sold is where the success of the business is, not with the owner.
Document processes. Financial books are not the only thing that should be in order. Make sure the business’ processes such as job descriptions, employee handbook, inventory, vendor and client lists, insurance policies, and daily business records and procedures are well organized and documented.
Clean, refresh and organize. A buyer looks for a financially sound business, but curb appeal matters as well. A new business owner doesn’t want to inherit someone else’s mess. Clean out and get rid of unused supplies, and update with new paint and carpet to give the business a fresh look.
“On their own, these things probably won’t make or break a sale,” Hottes states. “But when you combine these items with having financials ready, the business showing a profit, and utilizing the skills of an experienced certified business broker, it could give a business owner the edge needed to get the business sold.”