You may have spent years building your small business and making sure it thrives. But now, you are thinking of moving on. Maybe you are ready for something new. Maybe you want to retire and spend more on the golf course. Yet, the idea of selling your business is a bit daunting. What steps should you take as you approach selling your business? How can you avoid making mistakes during this process?
Here are five important things to keep in mind as you consider selling your business:
- You need to have a current valuation of your business, so you know how much your business is worth.
- You want to set up any potential buyer for success. As part of that, you want to update your business’ standard operating procedures, employee handbook and train key employees on how to operate your business in your absence.
- You want to market your business to generate interest in its sale. This can include telling your employees about your intention to sell it, to see if a couple key employees may want to buy it, and letting any business groups you are a member of know about your desire to sell. One of your professional contacts may know of someone who might be interested in purchasing your business from you. You also want to be prepared to answer questions from potential buyers, to lessen their fears about why you are selling the business and moving on.
- You want to make sure you sell your business to the right person. You don’t need to accept the first offer that comes your way. You want to evaluate any new potential owner by keeping your business’ long-term success in mind. Does your buyer have the experience to lead your business and help it grow further? Do they have past management success they can build on? Do they know your industry, understand your customer base and know how to market a business successfully?
- You want to work closely with an attorney to negotiate a sale agreement, to best protect your interests in the business sale and still create a win-win situation for you and your buyer.
If you take the right steps, you can more easily transition out of owning your business. You can help ensure your business will survive after your departure and choose the right buyer who knows how to help your business succeed for years to come.