You can already picture it – you’re sitting poolside in a lovely cabana in Hawaii, surrounded by the sounds of clinking pina colada glasses and splashing dolphins. “Ahh…retirement is nice…”
You still have to actually sell your business… at a high value!
This is when the mirage all comes crashing down.
For many business owners, the reality is you’re still in your office contemplating the best route to sell your business and you don’t even know where to begin!
This is where a business broker comes in.
Business brokers are the best option to get a valuable and successful sale of your business. Below are a few reasons why you should invest in your future; by investing in a business broker.
The first thing a business broker will do is analyze your business and map out its strengths and weaknesses. These are going to be very important to a potential buyer and can have a huge impact on the price you can offer.
(recurring customer base)
(good traffic or scarcity of competitors)
Once they have done your analysis, they can walk you through ideas on how to lean on your strengths and cure your weaknesses.
• Organize financial reporting
• Write down clear operations and procedures
• Assist with marketing i.e. re-examine your target customer and expand or begin focusing on the best target audiences
If your sales and revenue reporting is accurate and easy to understand, this is a “plus” for potential buyers! They are much more willing to accept your price point if they can easily see the revenue AND the costs of your business. Also, giving the buyer a written down form of your business’s daily or yearly operations and procedures shows the buyer how stable your business is run and encourages them that they will have an easy transition when the time comes. These are just a few examples of how having a business broker organize and create easy-to-digest information about your business can increase its value in the mind of a buyer.
Riding on the backs of the last two projects your business broker does for you to help sell your business, they can give you a professional value proposition!
A certified value proposition is key if you want to get the best value for your business during its sale. This document is going to back up the price you’re asking for and makes it that much more concrete during negotiations. It is also a trust builder between you and the buyer. They know exactly what they are purchasing and the facts to back up the price point.
It is a business broker’s FULL-TIME JOB to market your business and search out the perfect list of buyers for your business. While you are busy maintaining the day-to-day operations to effectively run your business, the broker is handling everything, from pulling all the necessary paperwork together, to making connections with buyers and setting up meetings.
One of the biggest mistakes that a seller can do is begin slacking off on running the business during the process of trying to sell their business. This risks decreasing the value of your business, leading to a shaky transfer period for any potential buyer. A business broker would help ensure this doesn’t happen.
Source: Investment Bank
Lastly, a business broker is an excellent impartial viewpoint to have during what can be a very emotional and stressful process. Many business owners are very protective and attached to their businesses, understandably so! You want someone who is going to put as much care into the continuation of your business as well as have a good outside perspective to find the best solution to achieve your future goals. They are also exceptionally useful as a mediator between a buyer and the seller during the negotiations phase as the proposals get more intense and in-depth.
You can absolutely sell your business on your own, but it’s important to know what you are getting yourself into before attempting what will most likely be the biggest sale of your life. Much like selling a house, it’s not unheard of for someone to sell their own business. Though, the process of selling a business can be much more complex than selling a home.
Here are some of the tasks you must take on if you plan on doing this “solo”.
**It’s important to note that the sale of a business takes an average of 9-10 months, not including preparation time like planning the exit strategy and building business value before conducting the final business valuation.
If you’re thinking about selling your business and don’t know where to start, consider speaking with our team here at Advanced Business Brokers. We specialize in brokering and advising exit plan strategies for various sizes/sectors of businesses.