How do you know WHEN to sell your business? – what is the best timing to ensure maximum sale price and to sell your business fast?
When to sell a business is a common question we hear as business advisors. In this article we are going to give you some guidance on business sale timing and outline some of the key issues that you should address before putting your business on the market.
Is there a best time to sell your business?
Firstly, the age old question: Is there a best time to sell a business? Here are the two best business ideas to answering this:
Business Sale Idea #1: Sell your business when the business is booming or after a good year ie there is clearly good business growth
Business Sale Idea #2: DON'T sell your business when the business is on the down or after a bad year
Seems obvious and often easier said than done, but if you want to maximise the sale price, these two best business ideas work every time! We see so many business owners try and sell after a bad year – they leave it too late and they can pay a big price for leaving it too late.
Here's why showing buyers your business is on the up with good figures and good business growth is so important:
- It impresses them!
- It shows the business is successful = gives them more confidence to go ahead with the deal
- It makes it much easier for business buyers to get funding
- It gives them less to bargain with you in the final negotiations – good figures are hard to argue with!
Also something that you may not have considered is that it is better for a business buyer to come into a business showing good business growth ie on an upswing, because profits will be high and they will have more chance of doing well and surviving in their most vital first year of taking over your business.
Getting the actual timing right…
As business advisors, here's our best advice if you are thinking of selling your business:
Don't leave it too late!
As we say repeatedly in our seminars – don't just rock on up to the market and expect to sell your business for top price! It just won't happen in the current market.
You will need to plan and prepare. Start planning now and getting everything in order. If you have been following what Liz and I say and teach, you will know that it is far better to ALWAYS have your business in a sale ready state so no excuses here!
Our experience is that it is ideal if you have 12 months (or more) to prepare fully for the sale of your business. However, you can rapidly get a business ready for a top sale price in 12 weeks -and of course we have a program that helps you do exactly that! Just check out our excellent 12 Week Turn-Around Program at http://The12WeekTurnaround.com which gets your business ready for sale within 12 weeks so you can sell your business for top dollar and sell it fast!