6 Tips to Prepare Your Business to Be Sold
Are you considering selling your business? If yes, then this episode is for you.
The top tip to prepare your business to be sold is to establish an Automated Computer System. Measuring sales, cost of goods sold and financial data over a computer system will impress buyers. Today’s buyers want to see automated systems.
The second recommendation is to Clean Up the Books. The cleaner the books, the more competition you will have for your business and it will speed up the cycle of getting the business sold. Bottom line is that clean books will get you a better price and will separate yourself from similar priced businesses. Invest in a good CPA- it will be worth it in the end.
The third suggestion is to Stop Hiding Cash. Many buyers are turned off to buying a business that relies upon cash since they cannot verify the numbers. However, being able to provide cash receipts for the past few months can go a long way.
My fourth piece of advice is to Establish Your Reason for Selling. This sounds simple but it is a question every buyer will ask and it will be listed on the search engines. If your reason for selling is not consistent throughout the sales process, the buyer has a higher chance of getting cold feet as they will likely start questioning other consistencies.
My fifth tip is to Know Your Exact Sales Number For Previous Years. Sales numbers that are exact get higher inquiry rates on the search engines. For example, a business that shows that they did $634,974 dollars in gross sales for the past year will get more inquiries than a business that shows $635,000 in gross sales. Avoid listing a business that shows triple zeros in its gross sales number. A Sales number that looks exact creates trust for buyers and will result in more demand for your business.
My sixth and final piece of wisdom for a business owner is to Concentrate Yourself on the Business. A major mistake owners make before they list and during the listing period is to not put as much time or money into the business. However, financial positive trending is very important to buyers. As such, keep your eye on your business to ensure a successful sale or declining revenue will make you reduce your asking price.