You are considering selling your business. You may have poured your blood, sweat and tears into it but it is time to move on. It is quite common for business owners to believe that their business is actually worth more than it is. However, it can be just as common for business owners to sell their business far below what it is worth simply because they do not have the financial information to back up this value. You should not sell your business on your own. You need a professional who has experience managing the process. Also check out www.bizbuysell.com/ the largest business marketplace online.
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If You are Selling, Make a Profit
If you are selling during a time of economic downturn, like many business owners are doing currently, it can be even harder to sell a business at a profit. In recent times, many business owners have had to scale back on their businesses just to keep the doors open. You may have:
- Reduced the product options you sell
- Lowered the amount of marketing you are doing
- Reduced any unnecessary expenses to ensure your costs where as low as possible
Perhaps even more importantly, you may have seen your business sales drop. If you want to sell now, the potential buyer will need to determine the financial potentials of the business and those lower than normal numbers are likely to be one of the biggest factors holding your business back from a profitable sale.
Some business owners have wanted to sell their businesses for some time, but have delayed in doing so to help avoid selling the business at such a lower price point. You may have cut out everything you could and are just keeping the business in the black. In fact, many brokers informed business owners that selling a business when revenue and profits were down just does not make sense. The problem is that the low purchase price valuations hurt the business owner. So, many people held on to these businesses.
In the last year or so, though, changes have helped to encourage business owners that now may be the ideal time to make that sale happen. The overall business sales market is up now, though, and that means that it may be time to consider selling your business. If that is the case, it is critical to focus on ways to improve the overall look of your business so that you can increase your sale margin. For those who are selling this year, be fully prepared.
Next: Planning for the Sale
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