You can’t underestimate the importance of acting quickly when you’re ready to sell your business. To get the best possible valuation, you need to sell your business when it is performing well, preferably at a peak before it begins any type of decline. That said, it is also important not to rush into the sales process. The key to a successful sale is to seize opportunities but to first ensure that you’re fully prepared when that optimal moment arrives.
In other words, if you know you want to sell sooner rather than later, now is the best time to start getting prepared. Why? Well, simply put, you need to have everything lined up and at the ready, so that you have the best possible chance of getting a fair price for the business you worked so hard to build.
Here are a few things that you can start doing now to prepare for the sale of your business:
1. Get Your Financials in Order. If you were going to sell your house, would you wake up one day, put it on the market and then have an open house that afternoon without first cleaning up the place? Just as you wouldn’t let a prospective home buyer tour a cluttered, dusty property, you shouldn’t let a prospective business buyer comb through cluttered, disorganized financials. Spend the time to get your paperwork in order and make sure that you have all of the essential documents at the ready. Be sure that you’re keeping accurate records from this point forward, so that you’ll have the most up to date information available for prospects.
2. Find a Broker. If we return to our home selling example, most sellers know that they will need a real estate broker to help them with their sale, and it is wise to interview more than one to find the ideal fit. Similarly, lining up a business broker ahead of time will help you be well prepared for listing your business on a market. Brokers can always be beneficial for business owners who want to sell, but they are especially important for the sale of online businesses, as they require a special type of buyer that a business owner will likely find it difficult to locate on their own.
3. Map out a Strategy. Once you have identified the right business broker for your needs, you’ll want to put together a strategy for a successful sale. He or she will likely provide you with recommendations on how to ready your business for sale and help you develop a timeline for when to list your business. You’ll also discuss marketing strategies and come to an agreement about how to best sell your company. If a broker is hired to help with strategy, it will save you crucial time and resources to assist with this task.
4. Understand Valuations. Before you consider listing your business for sale, you need to understand how companies in your niche or industry are valued. Knowing what the biggest determiners of value are can help you maximize the assets of your business and be ready to explain any short comings to prospective buyers. For example, in some niches, you will want to maximize your inventory to improve your company’s value. In others, you may want to ensure your client database is complete and strong. If you know what will make your business the most attractive to buyers, you’ll be able to make changes and improvements to improve your valuation.
5. Develop an Attractive Sales Kit. An attractive, enticing sales kit is vital to the successful sale of a business, so you want to take your time and ensure that you have put together the best possible kit. Your business broker will guide you through the process, but you’ll want to make sure you have enough time to complete it. Taking time to provide the best information possible to showcase your business will assist your broker in creating standout marketing materials.
6. Communicate with Your Team. It is always a good idea to discuss the sale with your employees before you list your business. Transparency can help to ensure that you’re able to retain your most valuable personnel who will help add to the value of your business and ensure a smooth transition. Keeping the intended sale a secret could lead to a massive walkout with your staff going to a competitor or disgruntled employees that undermine your efforts to sell.
Having helped hundreds of business owners like you successfully sell their online businesses, we can help to guide you through the preparation process, so that you can get the best possible valuation and enjoy a smooth transaction. Contact us today to learn more about how we can help you prepare today to sell your online business tomorrow.