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Print Posted by SMEA Posted on 06/09/2017 in Ownership

Thinking of Selling Your Business?

Thinking of Selling Your Business?

So you are thinking of selling your business? This is not a spur of the moment decision. Whatever your reasons, you have had it on your mind for a while.

Wherever the idea is in its gestation, as a business owner you need to thoroughly assess your goals in selling the business. What are your objectives? What are your timeframes? What are your expectations? Just like selling a house, you need to be honest and practical in your assessments and not get carried away with unattainable dreams.

When you find yourself in this position, what are some of the things you should consider before you put your business on the market?

Are you in a position to sell? Experts recommend at a minimum two (2) years of preparation before you sell your business. That will allow you to provide multiple years worth of tax returns which will show the profitability of your business to a prospective buyer.

Is it the right time? Selling when the business is not doing its best is not the ideal situation. Selling at its peak will help you achieve the optimal outcome.

Profitability not potential. No matter how much potential you may see in your business, most buyers are interested in profits. They want something that already has had proven success, not something that is yet to be proven. Profits will be prioritised over potential and revenue.

Questions. There will be lots of them. Are you prepared for them? Buyers will do their due diligence and will expect you to be able to answer the questions they have. Have you got all your information straight?

Engage the right team. Make sure you engage the right business broker and team to achieve the best outcome for yourself. Ensure they are professional and understand not only your business but what you want to achieve.

Whatever your circumstances, coming to the decision to sell your business is a difficult one. After all you have invested so much of your time and effort in it the first place. Its like a child in so many ways. Watching it grow up and leave is difficult. But there will come a time where you need to move on to other opportunities. Just make sure when you do, that you are fully prepared and understand how to get the most out of your sale.

Read the 4 Myths About Selling a Business: Debunked and A guide for selling or closing your business for some more great tips on selling your business.

The SME Association of Australia provides a comprehensive platform for the collaboration of businesses, organisations, associations, schools, higher education bodies and government to ensure SMEs are equipped to connect, grow and prosper. Find out more at http://www.smea.org.au/. Join our SME Community, follow us on Twitter | Facebook | LinkedIn and subscribe to our podcast SME Radio

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