The following ideas can help you maximize the value of your business in preparation of getting your business ready to sell.
- Good Financials. Assuming the obvious…that you have a profitable business, have organized books and records will confirm and defend the value of your business.
- Someone in Charge. Does the business run smoothly without the owner around 24/7? Having a key person (or team for the matter) that is capable of running the business without the owner is almost priceless.
- Systems and Operations. Goes hand in hand with #2. Does everyone know their responsibilities? Can your employees be held accountable? Detailed operating systems can make a business transition seamless and easy.
- Recurring Revenue. Can your business offer a service or product that can be sold automatically to the end user? Great examples: “Dollar Shave Club”, IT Companies with service contracts, Restaurants with paid “VIP/Wine/Cigar Clubs”, etc.
- Diverse customer base/income. Does your business get a majority of its revenue from a few customers? Work on diversifying your customers.
- Barriers to Entry. Does your business have high barriers to entry? Can you make it hard for competitors to take your market share? Maybe you have trademarks, patents, or special product and services that are not easily duplicated.
- Improve Cash Flow. Can you speed-up your collections? Maybe you can offer small discounts for faster payment.
- Acquisition. Two plus Two can equal Five! Can you buy a business that can be either vertically or horizontally integrated? Then eliminate duplicate or inefficient functions, and sell at a premium.
- Exit Strategy. You get MAX value from selling your business when it is a carefully planned exit. Consider the alternative, being forced to sell because of a major life event: divorce, death, disease, etc… then you might be forced to take a sub optimum deal.
Want a confidential meeting with a Business Broker? Maybe you would like an opinion of value or business valuation. We can help. Contact us today.