Do you have a well-planned business exit strategy? Do you want to sell your business in Colorado?
About Ten Thousand individual Baby Boomers (born between 1946 -1964) are retiring every day, and fewer business owners are passing their businesses on to future generations. As an entrepreneur, it’s not a matter of if, but when you will no longer be a business owner, and become a business seller.
The Small Business Administration reports that one in three small businesses plan to sell their businesses within three to five years of owning them. Strategically planning how and when to sell your business pays big dividends in earning the highest multiple and premium for your business.
There are also some important factors that ensure a proper business transfer is accomplished, such as:
- Proper Timing. Buyers want to acquire a business with an upward trend; so if your company is moving in the right direction, this is good news for you as a seller, is to earn a higher multiple upon the sale of your business, and good news for the buyer to feel comfortable about the future potential of the business.
- Proper, Confidential Marketing and Vetting. There are ideal purchasers for each unique business. A good brokerage firm understands how to leverage myriad marketing channels to find and qualify the right buyers, and then have them compete in a competitive environment.
- Reasonable and Motivated Parties. Not only is it important that the buyer sees the future potential and that the seller has a continued pipeline of business throughout the transaction, the seller must keep the business running properly throughout the process, and maintain his or her enthusiasm, motivation, and commitment to finding the right buyer and closing the transaction in a fair and ethical manner.
- Reasonable Terms of the Deal. When buyers and sellers come to a meeting of the minds and in the negotiation process and a deal structure is created that is fair for both parties, business transactions occur. In many transactions, buyers and sellers are working together in training to ensure a smooth transition, as well as many, are involved in carrying a note on the transaction so they may still be connected in some capacity for several years after the business transfer.
You have put years into building your enterprise and naturally you want to earn the highest price possible in the sale of your business but the market will ultimately determine its value. Determining a proper and fair business valuation based on the value drivers of your business and industry analysis is only a part of the equation. Other factors such as the economy, interest rates, and a strategic acquisition play an important role in maximizing your profit.
I am a big proponent of creating a successful business that provides the lifestyle you want and runs well with or without you. The return on your investment for a good business is typically unsurpassed when it comes to investments. There are several reasons why individuals want to sell a business but timing should also be considered. When the economy is strong, the business is growing, and interest rates are lower, you may want to consider this a good time to plan your exit strategy to earn a maximum profit on the sale of your business? Some business owners want to kick themselves for not getting out when it was an ideal time and are forced to sell later when the timing is less than stellar. Additionally, if the right strategic buyer is found to acquire your business, you may have several years of employment with them and delay your retirement or continue an income while you plan your next career or investment opportunity.
Let a Professional Advisor Help You Sell
As a business intermediary, I primarily represent sellers and I am experienced in keeping the parties on track, and the transaction moving along as smoothly as possible, with the right strategic partners, while you continue to properly run your business to maintain sales and earnings, with less emotional strain and distractions.