Business Sale initial valuation and the sale process including hurdles
What is the sales process?
Firstly we carry out our Quick Report to overview the business and give you an initial valuation.
This report is as much for us as well as you, to assess the value and marketability of the business, what actions need addressing before we go to market.
If we both agree on the findings we go forward to agree contracts to market the business on your behalf- no commitment is necessary till this report is published, discussed and agreed.
We then move forward to the next stages:
- Formal valuation
- Preparation of sale memorandum
- Researching for optimum buyers
- Grooming the business for increased value
- Managing the process, all parties and time scales to expectation
- Liaising and engaging with the right professionals
When is the right time to sell?
Ideally the best time is when you are making profit, with a trend of growing sales, and of course when you feel in your own mind, the time is right for you.
However, only 50% of businesses sell when the time is right. Other factors and elements take hold and owners and shareholders take the decision to sell, when they feel exhausted by the market, profits are hard to come by, etc.
This is not necessarily a major issue; acquisitors generally buy companies for the increased opportunity and future profits they can generate from the new acquisition. Sometimes this increased value is a perception and not a reality, but companies will still pay handsomely based upon these beliefs.
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 How do I optimise my sale price?
In most cases, selling a business takes 4-8 months from decision date. The more time we have generally delivers better results. This allows at least 3 months tackling several elements that will tangibly improve sale price-
- Sales pipeline
- Operational costs
- Gross margins etc
These are 3 key factors. In addition elements such as image is a factor, but you don’t have to fix ALL the faults. You must leave some elements for the new owner to recognise and let them fix. Image is an easy one compared to the sales pipeline.
How do I protect my business with staff loyalty and customer retention?
Firstly- call us and engage us to help you through this process. We’ve done this many times both for clients and ourselves.
Selling a business can be both a threat and opportunity for staff. There are always risks with change of ownership. Before you tell your staff and customers, it is vital to evaluate the present performance of the business and its current stability.
If strong and steady, confide in key staff early and the rest soon after. Secrets will not last long.
If there are business issues, hold off going public for longer. This is an important factor and needs to be discussed in confidence with some detailed facts.
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Call us for more information or a confidential discussion 0800 999 6600 - weekdays 8.30-17.30, or feel free to call on weekends/evenings on 07793 802894 or email us info@sellmybusiness.biz
