The economy is generally good. Does that mean I should sell my small business before we see the next downturn? The answer is “it all depends.” The economy
does play a role, but so do many other factors.
Before you make that decision, closely consider these five questions:
1.Do I really want to sell?
2.Is my business in shape to sell?
3.Does the current market favor my company?
4.What do I need to make on the sale after taxes and expenses?
5.What will I do after I sell?
The reason for selling your company can dictate how you approach your exit and identify the types of professionals with whom you want to work. If you are seeking to sell to get out from under debt, or if you simply do not see any other options – then you may want to first talk with a someone in the area of turn-around management. A turn-around specialist will give you a plan for moving your company (and yourself) to better footings, but may not be the person to market your company. To sell your business, you should consult a financial intermediary or business broker.
There are some very good financial intermediary and turn-around firms that work with small companies. To find them, ask for referrals from your trusted advisors and from individuals who have worked with such firms.
No matter when you decide to sell your company – now or in the future – if it is not in good shape with respect to the factors below – it will not bring top dollar, and it might not even sell.
Be realistic, work with a financial planner, accountant and/or tax specialist, and determine what you would take away from the sale of your business, given the potential selling price of your business. Then, decide if that is enough money for you to consider selling.
The process of selling a business is stressful – and you’ll want to specifically plan for dealing with the stress. Start thinking about what you would like to do before that day arrives. Will you need money to start a next career or will you take time off for golf and family? Just as you strategically planned for building your business, strategically consider the next phase of your life. Set goals based on what you and your loved ones what, and then move confidently move into the future.