What If you’re a business owner? What happens when you Don’t Love Your Business Anymore or get restless, bored, or uninterested?
On another side, Employees can quit when they are uninterested or frustrated.
Don’t Love Your Business Anymore
When you own a business, you might love it now.
However, with time even the most passionate and successful entrepreneurs ask themselves; What’s next?
Do you know many business owners who start a business hoping to sell it someday?
Some CEOs might get exhausted and quit, while others might run off of ideas or no longer want to run the business they started. If you have another long-term plan, a new development, want to sell your business, or just shut it down, you first have to prepare everything.
We have some steps which you can follow to make a steady transition.
Know What You are Selling
In a company, there are tangible and intangible values. Depending on the buyer, each buyer will look to buy a different aspect of your business. You might not even know the many valuable things a potential buyer might find.
Some of the valuable things potential buyers might want in your business include:
- An influential, reputable name and brand recognition.
- Skilled, expert employees and a spherical management team
- Real estate
- Market share in their desired area
- Physical resources or goods, like factories, machines, equipment, warehouses, and so on
- Recurring earnings
- Intellectual property, meaning areas of a business that can you can package, promote and preserve
You might have all the knowledge needed regarding what your business assets offer.
However, you need to see if potential buyers can see those assets and whether you and those assets are ready to get shifted to new owners. Before putting your company up for sale, the best thing you can do is get an expert to get a professional valuation of your business.
You will be able to understand the assets that are valuable by getting this valuation done.
Once you get a valuation of our business, you can work to strengthen your business and sell it from a strong point of view. Moreover, you can get an optimized value when you create an exit plan.
One thing many forget is their management team. When you have an autonomous management team, the owner will have a lot of options.
You can sell the whole business with the management team in place. However, you can also make your management team independent, so you do not have to be there to do daily roles without participating every day.
Take your time to obtain the best buyer and the best offer.
Cash is everything, but Recurring Revenue is what you need
In a business, the most valuable asset when selling a business is recurring revenue.
When you have opportunistic sales, the less market value will be. However, if your business sales get repeated and regular, your business’s market value will be much higher.
That is why you should consider recurring revenue before selling your business or putting it on the market. Work on getting customers into a routine or buying from you to get a better value for when you sell it.
Do not Depend on a Big Check
Most business owners sometimes think they can sell their business and get a huge cheque in return and turn their back on the business.
However, that is not exactly what happens and always will happen. It is common for a seller to overvalue their business, and some buyers might even pay the asking price.
However, many buyers will be cautious and might not even buy an upfront buyout. If you be innovative, you could get the full valuation buyout of your business.
Let us say you want to sell your business for a million dollars. However, the buyers value it at $600,000. You could still get a million-dollar sale.
How?
You can take a 10% down payment from the buyers and accept payments from the cash flow, which will get you the ideal price you want.
In some sales, having the original value adds value to the business. The owner gets paid for having their name still on the business as the buyers transition slowly over the next few years.
Sometimes, a buyer might tell the owner to keep the not until the pay-off period so that the buyer doesn’t have to deal with the bank and the buyers pay interest to the seller.
The main goal is to sell your business innovatively. However, if you want to get a big payment and leave, you can do that also.
Never Rule out a Slow Exit
Many business owners might want the sale to happen but might not want to retire fully.
If you are one of those people, you can partially stay involved by selling the business. If you sell it whole, you can stay involved in the business or management issues in a premium part.
Similarly, you can transit yourself out when you sell it and remove yourself from all business-related activities. Many business sellers might sell their business get a big check, and walk away but will have many regrets.
Therefore, take a slow exit and an informed decision. Are you looking to sell your business and exit it? Have you planned for it? Or do you have another ‘what’s next plan?
If you want to sell a business in Victoria, visit Nash Advisory.