Building a successful business from the ground up takes sweat, blood, and tears. It calls for a lot of hard work and sacrifices to get it off the ground and turn it into a successful and profitable operation. And that’s why many entrepreneurs become so attached to their businesses.
They are so attached that they often have a hard time letting go even when it’s time to exit the business. Good thing, the services of a credible business broker in Salt Lake City or anywhere in Utah can help make the transition easier for you. Such an expert can help you get the best deal, one that’s worthy of your hard work and sacrifice.
Clean up your act
After a decade or so of running a business, it’s only natural to create a routine that works just for you. Unfortunately, that might come back to haunt you when you need to put it on the block. Buyers are more interested in the numbers more than your unique business model.
You must make your numbers sing and highlight the success of your operations. Before talking with a potential buyer, be sure to clean up your books. Make sure that your income statements, tax records, and other relevant documents are in order.
You might want to update and modernize some business aspects that could be lagging. That could mean throwing a fresh coat of paint, computerizing the inventory management system, and more. You want to present the business in a favourable light without misleading a potential buyer.
Have a professional evaluate the value of your firm and give you a realistic figure of its worth. Most businesses sell for up to six times their annual cash flow. Account receivables, debts, assets, liens, sales, and inventories are some of the factors that experts consider when valuing businesses.
Bow out while at the top
Why are they selling? This is the question at the top of every potential seller’s mind. As such, they will go to great lengths to find a hidden weakness that can give them an upper hand in the negotiations. Crafting an exit strategy for your business ensures that no one can back you up into a corner.
It’s more empowering to sell a company while it’s still highly profitable. You can demonstrate that the numbers are good and that there’s always room for expansion or untapped market potential that the buyer can tap into. All investors are fixated on the financial health of a business they need to acquire.
If the books don’t paint the ideal picture, you can opt to postpone the sale and buy yourself some time. Use that grace period to double down on your marketing efforts and grow your sales and revenue. Buyers are willing to pay top dollars for a thriving business.
Buyers are always looking for a reason to drive down the price when buying a business. Planning your exit strategy carefully lets you remove any exploitable weaknesses. Only then can you command a good figure for your life’s work. Working with a professional can ensure that cover every base and get a good deal.