When you’re getting ready to sell your business, it’s all too easy to start winding down and take your foot off the pedal. If you want to make your business as attractive as possible to potential buyers – and get the best deal you can - you need to work harder than ever in the months leading up to the sale.
Some of your essential prep will involve getting your paperwork straight so it’s easy for buyers to see how buoyant your business is, while other tactics include filling your order book and making sure day-to-day operations are running smoothly and efficiently to demonstrate just how quickly a new owner could take the reins. Get your house in order at this stage and the offers will start flooding in.
Take time to compile accurate financial information to show buyers how your business has been performing. While you’ll be rightly proud of your brand, staff and track record, your buyer will have a keen eye on future prospects and will part with more cash if they have evidence of a recurring revenue stream or ongoing customer contracts. Spend time developing this area and you’ll reap the benefits in your sale price.
Do your homework
Prospective purchasers will want to see that all your paperwork is in order. Apart from satisfying them that your tax records, leases, contracts and articles of incorporation are ship-shape, it also reflects well on the efficiency of your business operations. If a business owner can show due diligence, they’re much more likely to appeal to a buyer who wants to do things by the book and it provides reassurance at exactly the right time. So make sure your company accounts up to date and that operational manuals and HR policies are current.
Get your staff on side
If you employ staff and feel they’re a real asset to the business, so will your prospective purchaser. Naturally, your employees aren’t tied to the company indefinitely but if a buyer can see they’re committed, happy and valued, they’ll not only add value to your proposition, but will make the transition easier, too. On the other hand, a business that’s too reliant on its owner will put off buyers as they fear a business will suffer if its lynchpin leaves. Make it clear that the business can operate without your attention and empower your management team to lead in your absence.
Spend to earn
If you think there may be some areas for improvement in your business, consider taking care of them before you market it for sale. It may seem counter-intuitive to splash the cash on upgrading your computer systems, updating your premises or upshifting your marketing efforts but a modest spend at this stage may seem like a wise investment if it gets you a better sale price – and keener buyers. Set aside some time and effort to getting every aspect of your business just so and it could pay off handsomely when you come to sell.