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Why Sell Now?

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Selling your business could be the most pivotal event of your lifetime; so first make sure you know why you want to sell. Zig Ziglar, author and motivational speaker puts it this way: “Unless you have a definite, precise, clearly set goals, you are not going to realize the maximum potential that lies within you”. Here are the most common why-considerations you must have sorted out before you know if want to sell:

 

Retirement – You may have successfully run a business for many years but now you want to retire and start to reap the rewards of your hard work.

Family Obligations – Maybe you started your business as a single man or woman and then the growth of your family led you to want to sell your business and focus more time on family.

Business Expansion – Investors love to buy already-flourishing companies. Sometimes it is best to sell while you are still ahead of the game and before your business heads south for whatever reason (within your control, or not).

Decline in Profits – Your business might be going through a dry spell that you cannot recover from and it might be an opportune time to sell to someone with a more modern vision and capital injection to get things running again.

An Offer You Cannot Refuse – There might be an offer from your competitor that you just simply cannot refuse. You might be thinking of moving, and someone makes you a great offer. You take it because you know it’s an attractive deal.

Personal Health Reasons – Life is not always predictable and if you are diagnosed with a debilitating health condition, it may be a good time to consider selling your business to prepare for your unpredictable days ahead.

Business Landscape Changes – Look at 2020 and how quickly the business landscape can change in an instant. Online industries flourished while the hospitality and tourism industries struggled and many businesses ended up closing permanently.

New Opportunities – New opportunities always present themselves at opportune moments. An offer may come for that dream business you have always been waiting for therefore you may need to sell your current business to make way for the new one.

Under any of these scenarios,  it is decision time – and the answer is very simple: there is never a ‘best time’ to sell a business, but there is always a ‘right time’ to sell, and that is when you have your ‘why’ figured out.

It is never too late even if it does not feel like the right time. Every business has strengths and weaknesses, and for some it may be good to sell while you are ahead and for others good to sell due to the uncertainty that lies ahead.

Even in a global crisis, there are always those who have unlimited cash it seems to invest and buy businesses. Bank lending options and low-interest rates make it possible to buy in a “seller’s market”. Even now during this Pandemic, even though many businesses failed, and consumer spending was at an all-time low (and now resurging), the underlying economy has still been strong with many buyers searching for new investment opportunities.

Avoid making silly mistakes in the process of selling your business and be patient. Do not be impulsive. Clever and careful planning with your broker will prevent you from making mistakes that will negatively affect the outcome of a sale. Top three mistakes to avoid are:

Not finding the right brokerage

Look for M&A advisers who will work alongside you and understand the unique needs of your business. Do not be in a hurry and choose the first broker who comes along. Do some research ahead of time of companies who have handed over businesses successfully in the past.

Asking the wrong price

Setting an unrealistically high price will lead you nowhere! Equally setting it too low will not help you but leave “money on the table”. Get a qualified fair market value from an independent valuation company but do not use your accountant, lawyer, or inhouse accountant for such – they simply do not know or have the experience.

Waiting too long to sell

Do not wait for a best time, as that cannot be found, and just listen to your “why”. If you wait too long to decide the buyer may move on to another opportunity. Indecisiveness is not working in your favor. If you have decided to sell, commit to the process fully.

Preparing for a Sale

The key to a successful transfer is a thorough preparation and making sure your M&A advisor does extensive research into potential buyers both local and international, and looking at investors and buyers outside of your industry.

When you are preparing for a sale, focus on your company’s unique strengths and the opportunities for growth in the future. You must preserve what sets your business apart from the rest, define the competitive advantage. Let your M&A Advisor gather all necessary information as well as preparing a professional management presentation. Accurate and dependable record-keeping is essential for a smooth handover.

Ensure you have ongoing sound advice and negotiation services that run smoothly throughout the entire process. When you stay focused on running the business and your M&A Advisor stays focused on the selling your business, there is no reason you cannot experience a smooth transition and have a successful handover at the end of the day.

Ultimately, the decision as to when to sell is a very personal one. Selling your business is very exciting and could open many new avenues for you and your family that you have not even considered.  Just ensure you have a good M&A advisor on your side. Whenever you do sell, it will be the right time if you have your ‘why’ sorted out, go about it the right way, and get the right people and team into your corner.

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About A Neumann & Associates, LLC

A Neumann & Associates, LLC is a professional mergers & acquisitions and business brokerage firm having assisted business owners and buyers in the business valuation and business transfer process through its affiliations for the past 30 years. With an A+ Better Business Bureau rating, the company has senior trusted professionals with a deep knowledge based in multiple field offices along the East Coast and has performed hundreds of business valuations in its history. The firm’s competitive transaction fees are based on successfully completing transactions. For more information, please contact A Neumann & Associates at 732-872-6777 or Info@NeumannAssociates.com

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