No one works forever. Regardless of how much you love your business, sooner or later you will have to step away. Owning a business can be demanding. This can be doubly true for owner-operators of businesses. At some point, you’ll have to embrace retirement and that will require a transition out of your business.
Many business owners want to sell their business to fund their dream retirement, but don’t know where to start.
I’ve used these 5 Critical Questions to help my clients prepare and start increasing their business value.
Most business owners have never sold a business before and may not know what to expect. The good news is that prospective buyers usually like the idea of buying an established business directly from a business owner. It is key, however, to do everything possible to make selling your business, as well as the transition period, as easy as possible for a buyer.
There are many aspects of the transition process to take into consideration when prepping your business for sale. Prospective buyers want to feel as though they will have a seamless transition, so it’s in your best interest to evaluate what steps you need to take to make the transition smooth.
You are the world’s greatest expert on your business. As a result, you are perfectly positioned to evaluate your business to ensure that it is both appealing to a prospective buyer and ready to sell. Let’s look at the steps you can take to ensure a smooth transition.
The Top 4 Transition Tips
1. Automate as many processes as possible.
Prospective buyers are less likely to be intimidated by the level of work involved in owning a small business if much of it is automated. The odds are good that many of your prospective buyers have never owned a business before. One of the best ways to not scare prospects away is to make owning and operating your business as streamlined as possible.
2. Work with your employees, key customers, and vendors to ensure a smooth transition.
Anything that can cause a potential disruption may scare off prospective buyers. Put yourself in the shoes of prospective buyers and think about what may cause you concern if you were evaluating a business. Once you locate those areas of potential concern, do what you can start to remedy them, well before placing your business on the market.
3. Pick out your “second-in-command” before you sell your business.
A competent and proven “right hand” man or woman – who can step in and essentially operate your business – is an attractive asset to have in place when it comes time to sell.
4. Consider working with a merger and acquisition advisor.
Merger and acquisition advisors are experts in the art and craft of buying and selling businesses. They will be able to help you evaluate your business and address areas that need improvement, to ensure a smooth transition.
Taking these steps will not just make your business easier to sell, but it will also shorten the amount of time it takes to sell. The last thing you want when you are ready to sell your business and retire is for the selling process to drag on forever. Following these steps can help you plan well for your sale…and start planning for what’s next!