Many business owners are emotionally attached to their businesses, and it is easy to understand why. Typically, business owners invest not only a considerable amount of time and money into their business, but a good bit of themselves as well. Owning and operating a business often becomes part of one’s identity. However, no one will work forever, as retirement eventually comes for almost every business owner. With this in mind, it is important to prepare for selling your business well in advance.
Merger and acquisition advisors can take your knowledge regarding your business and use it to help you frame your business in the best possible light. Your personal expertise can also help an M&A advisor find ways to improve your business, so it is more attractive to potential buyers. With all of this in mind, let’s turn our attention to the key steps you should take when preparing to sell your business and transition into retirement.
Select Your Second-in-Command
Any savvy buyer will want to know that a capable team supports the business well. Buyers rightfully worry about having a smooth transition period, and nothing helps dispel those fears like having a proven and capable second-in-command standing by. When selecting this important individual, choose someone who understands how your business works and is a proven asset to its operation.
Automate, Automate, and Automate
Buyers can be intimidated by taking control of a business. Having a proven second-in-command ready to assist is one smart step. Automating as much as possible is another prudent move. In short, you want your prospective new buyer to feel more confident about buying and operating your business.
Is your business exit ready?
If you’re planning to exit your company in the near future, you may find EastWind’s Exit Strategy Playbook helpful in developing your own exit strategy, making your company more sellable.
Make a “Smooth Transition” List
As the seller, you have the critically important job of removing buyers’ fears. When you boost their confidence that they can successfully run your business, you increase the odds that your sale will go smoothly. Making a smooth transition list, which includes all the steps you can take to improve the odds of a buyer being successful, is a smart investment of your time and effort.
A good transition list will include information about how to work with key customers, employees, and vendors. You want to ensure that your customers, employees, and vendors understand that a sale will take place, but also understand that the process will be smooth and trouble free. Whether large or small, take any steps you can to show buyers that the transition will be well received.
The average business owner has never sold a business before and is unprepared for this very complex process. Since the process of buying or selling a business is complicated, business owners should strongly consider working with an experienced M&A advisor who can help guide them through the process. M&A advisors are experts at buying and selling businesses. They understand what both buyers and sellers want and need. As a result, they can help you take the necessary steps to get your business ready to be sold.