Selling A Business?

Selling a Business? Make it look more attractive for sale!

If you want someone to buy something, you have to convince them that it is worth their investment.

That’s true with a tube of toothpaste, a car, or even a business.

When selling a business, you obviously want the maximum return.

But, you are not going to achieve that unless the business you are selling looks like an attractive prospect to potential buyers.

How can you make it look irresistible?

Well, let’s explore that right now.

Selling a Business? Things You Can Do To Make It Look Good

If you are considering selling a business at some point, then you want to make sure it looks attractive to buyers.

Whether you are planning to sell next month or in three years time, taking these steps now will help you in the future.

Here are some key considerations when preparing your business for sale:

Let’s dive into the details…

Selling a Business? Make It Look Attractive For Sale.

Things You Can Do To Make It Look Good

Provide All The Data

Regardless of the level of profit your business is turning over, potential buyers will want to see how your business is performing. It doesn’t need to be making moonbeams to be attractive, it just needs to paint a picture of what is really happening so that people understand what they are getting themselves into when purchasing.

A big part of this will be providing evidence of financial performance. The more solid the performance, the more attractive the business will be. However, in saying that, some people look for businesses that haven’t quite hit their full potential yet.

The key is giving all the information for buyers to make an informed decision. Well organised and up-to-date financial records will provide this info. These records will then show any revenue growth, whether you have healthy profit margins, and how your cash flow performs.

Ensure Clean Financials

Take that data compiling one step further by focusing on making your financial records look attractive. That means checking that they are accurate and up-to-date.

Review your financial statements, balance sheets and tax returns to ensure they accurately reflect the real financial health of your business. While you are at it, minimise any non-essential expenses and look for any liabilities that you could address.

The objective here is to set clear expectations around the financial performance of your business and what results a buyer can expect to achieve when they take over.

Provide All The Information About Your Business

We’ve looked at the data aspect, but you are also going to need to supply information about your business story and an overview of what’s been going on. This will be like a guide for people who want to peek in behind the curtains of your operation.

Put together a document that gives a detailed overview of your business; including its history, operations, market position, target audience, financial performance, growth potential and competitive advantages. Highlight any unique selling points or intellectual property that your business has.

It’s about giving the facts, but also conveying the current vibe of your company. So, when putting this document together, think about the things you’d like to know when purchasing a business and put them in there!

Streamline, Streamline, Streamline

OK, you’ve prepared all the info that a potential buyer might need, so now it’s about positioning your business for longevity, even if it is going to operate under a different owner. The way to do that is to streamline as much as possible.

Now is the time to look at ways you can streamline your business operations. Consider standard practices and automation if you have not done so already. Also, try to implement scalable systems that show the potential for growth. It’s also important to document your key processes and procedures so that anyone can pick up where you left off.

The objective here is to remove the business’ reliance on you. Streamlining and documenting will make it easier for potential buyers to understand how your business functions and will allow for a smooth transition post-sale.

Identify Customer Base And Offerings

A big part of a successful business is understanding your ideal customers and ensuring your offerings serve them well. Having a good understanding of who your customer base is reduces the risk for your business. It means you can make informed decisions about the services you deliver or the products you offer.

A stable customer portfolio is an attractive thing to offer to your potential buyers. It indicates strong revenue potential and how they can increase the customer base for growth or sustainability.

Having a proven core set of offerings or products is also an attractive thing for a buyer. It means they will know exactly what they need to do to maintain current revenue levels and how they might complement those core aspects with new or complementary offerings in the future.

Build a Strong Team and Systems

Buyers will be most interested in a business that can continue operating successfully without heavily relying on the owner. The key is to build a strong team and good systems so that the business can run smoothly in your absence.

Regardless of the size of your business, you should have good systems in place so that things occur without needing your personal input.

For smaller businesses, this means Standard Operating Procedures and automated processes. For larger businesses, you still want those basics, but you’ll also need a competent and capable team that can effectively run the day-to-day operations.

Strengthen Your Brand

Your business brand is a huge asset, and a strong brand is very attractive to a potential buyer.

Consider how your brand is perceived in the marketplace and what you can do to strengthen it. A strong marketing presence is a good start as it creates opportunities for brand recognition and sales.

It can be helpful to take that one step further by protecting your brand and intellectual property. Trademarking can be a strong way to add credibility and protection to your intellectual aspects.

Clean Up

Take the time to ensure your business premises (if applicable), equipment and inventory are well maintained and in good condition. Remove any unnecessary clutter and rectify any outstanding maintenance issues.

Note down any equipment that will need replacing or updating so that a buyer has all the info they need before the sale goes through. If the return on investment is good, replacing old equipment can make a business purchase more attractive, but is not necessarily a deal breaker if it doesn’t make financial sense to do so.

Get Professional Advice

When selling a business, engaging an experienced expert can be really helpful. They can help you identify areas of the business to amplify and those that need some work before considering a sale.

So, if you are considering selling a business, then contacting an expert is a job you should have done yesterday!

It can take time to assemble the right documentation and rectify any sale-obstructing issues. So, getting expert eyes on your business is a top priority. They can also provide guidance on valuing your business and potentially even connect you with buyers or legal experts.

Here at Drumm Nevatt and Associates, we have the expertise to help you prepare your business for sale. So, reach out to our friendly team for a consultation today.