For many businesses there comes a time when it’s time to sell. Maybe the business isn’t doing well, or maybe the owner just wants to move onto something else. No matter the reason, when it’s time to sell, it’s hard to know what to do. There is a lot that goes into selling a business, and you want to make sure you get it all right. To help you out, here are the steps you should follow whenever you decide it’s time to sell your business.
Determine Why You’re Selling
The first thing you should think about is why you are selling. Do you need the money? Are you looking to retire? Are you moving to another location? Why you’re selling will help to determine a lot about the sale, so it’s important to nail this down. Take some time to think about it, and make sure you know your reasons before you go any further.
Give Yourself Time
Speaking of taking some time, you’re going to want to give yourself plenty of time to complete the sale. Selling a business isn’t something that happens over night, and can often take up to a year or two. This means that you want to start preparing in advance, and not when you’re ready to sell right now. The sooner you start planning the sale of your business, the sooner you can go through with it.
Evaluate Your Business
Next, you need to evaluate your business. This means determining how much it is worth, or how much you could sell it for. A lot goes into determining the value of a business. How much inventory do you have? What are your expenses and sales like? What sort of growth can you reasonably expect? You want to evaluate your business honestly and accurately in order to help the sale move quickly. If you try to overvalue it, or if you don’t give a full evaluation, this will only slow down the sales process. Here is some more information on determining the value of your business to help get you started.
Decide How You Want to Sell Your Business
Now that you know the value, it’s time to decide how you want to sell your business. You have two main options – you can try to sell it on your own, or you can work with a broker. Selling your business on your own requires a lot more work on your part, but you get to keep all of the profits. Working with a broker on the other hand is a lot easier, but you have to pay for the service.
Brokers provide a lot of advantages when it comes to selling a business. For instance, According to USDentalTransitions.com, brokers “know the ins and outs of the market, including what it takes to sell the practice at the best possible price.” They’ll also be able to help you with the paperwork, and help you to find a buyer. If you’re inexperienced with selling businesses, and you want the process to be as simple as possible, then a broker may be the way to go.
Find a Buyer
If you’re not working with a broker, then the next step is to find a buyer. Finding a buyer for your business isn’t as simple as posting an ad in a local newspaper, so you’re going to need some time to do this. Look for larger businesses in your niche who might want to expand, or for someone looking to run their own business without starting from scratch. In some cases you could be selling to a family member or a friend, making this step an easy one.
Once you find a buyer, you’re going to need to evaluate them. Make sure they can afford to buy your business, and that all of their finances are in order. You don’t want a buyer who is going to back out at the last second, or who doesn’t have a strong financial history.
Handle The Profits
Finally, once the business sells, you need to do something with the profits. We recommend not spending them right away. Take some time to think about what you want to do with the money, and make a plan that matches up with your goals. Also look into any taxes you need to pay on the sale, and be sure you include this payment in any of your plans.
If you can do all of the above, you should find that selling a business is a little simpler. For more assistance, talk to your local Chamber of Commerce for advice. While there is a lot that goes into selling a business, the above list should provide you with the basic framework you need to get started.