You’ve had a successful business for quite a few years, and lately the thought of selling seems to cross your mind more often. Some days you are ready to move on it, and other days you wouldn’t dream of selling. So how do you know when the time is right? I’d like to share with you my 5 top indicators that it’s time to sell.
You’ve Lost the Passion
Passion is what has brought your business to where it is today. It has been your creative juice. It’s what drives you to put in the crazy hours. The days when you couldn’t get to sleep because you had all kinds of business ideas aren’t there anymore. Enthusiasm for your business has been replaced with boredom and exhaustion.
Things Couldn’t Be Better Financially
This is probably the main reason you haven’t taken action to sell. How can you walk away from a nice paycheck, good benefits and that year-end distribution? You’re right, this is hard to do. Yet the best time to sell and get top dollar is when the P&L is shining, especially if the trend the last three years has been moving upward. If you don’t sell when times are strong, you risk a downturn internally (top employees leaving, health issues, etc.) or externally (new competitor takes market share, economic downturn, etc.).
Your Business Model is Exactly Where You Want It To Be
Maybe you’ve tried to sell your business before and you realized buyers saw red flags: 75% of your business was with one customer, or customers were still calling you, personally, for orders. Now you’ve fixed the issues and your business is running smoothly. You can take a vacation for a month and no one knows you are gone. You have training manuals in place. Your leadership team is running the show.
You Know What the Next Chapter in Your Life Will Include
When I owned a hospitality business, I began planning my exit five years before I sold. Not only did I work on making sure the company model was running efficiently, but I also began planning my next career. I went online and researched careers. The more I read about business intermediaries, the more interested I became. You may already have another interest in mind, or maybe you have another business opportunity that has more promise than your current business. By selling your current business, you will have plenty of working capital to infuse into your next venture.
You Fully Understand Your Personal Financial Situation Post-Sale
You have thoroughly gone over your financial situation with your financial advisor and with the assets you’ve accumulated, can comfortably walk away from your business. Your advisor has factored in your current investments, the proceeds from selling the business, and future social security payments. You’ve determined the number you require for living and your net worth can accommodate that number.
Selling your business…
can be one of the most significant and complex financial transactions you will ever experience. Wise business owners who want to ensure the process goes as smoothly as possible don’t ask “if” they need a business intermediary – they ask which intermediary should they trust to guide them through the process.
I work with business owners…
to find the best solution for their exit. I’m certified with the International Business Brokers Association and licensed in the state of Minnesota to broker the sale of a business. I specialize in preparing and implementing the selling plan which includes a market valuation, buyer search, negotiations, coordinating due diligence, lender options, document preparations and closing.