Putting your business up for sale? You’ll definitely want to get the best return possible for it, right? For businesses that are marketed right, selling them can be a breeze. Unfortunately, if your business is not prepared well for the sale or presented to potential investors correctly, it could sit on the shelf for years before you get a viable offer. To ensure this doesn’t happen to you, here are some tips to help you sell your business successfully and maximise the amount you get.
1. Hire the right broker
The first step we recommend is hiring a reputable business broker in Australia. When selling a business, a business broker’s services can be invaluable and are worth the investment nine times out of ten. Brokers are professionals who specialise in every part of the sale of a business. When you hire a business broker to help sell your business, they’ll assist you by doing a business valuation and assessing the worth of your business by analysing its financials, assets, performance, and operations.
This valuation will highlight key improvement areas to make the business look more appealing to individuals. Some of the main services business brokers offer include:
- Business valuation
- Preparing the business for sale
- Marketing the business confidentially
Screening and qualifying buyers - Negotiating deal terms
- Coordinating due diligence
- Assisting with paperwork and legal documents
- Helping secure financing for buyers
- Managing communications between parties
- Guiding the deal to closing
2. Get an accurate valuation done
Once you’ve engaged in business with a business broker, they will naturally guide you towards having a business valuation done. As a business owner, it’s common to perceive your business as being worth more than it is in the current market, which is completely understandable when you factor in the fact that you’ve probably invested copious amounts of time and money into building the business to the point where it succeeds or is currently.
A professional business valuation takes the emotion or bias out of the valuation and looks directly at the value indicators used to calculate the business’s value in the current market. This is important because the price is often one of the first things that catch a buyer’s eye. Think about it: when you’re walking down the aisle in a shop and see something you want, one factor contributing to whether you buy it or not is how much it costs. If the item’s worth suits its cost in your eyes, you’ll buy it; if not, you won’t. Investors think similarly. If there is potential to receive a return on investment for their purchase, the price might be worth it.
But if the price is too high compared to the perceived return, they might not be interested. So, having an accurate business valuation can go a long way toward securing a good buyer for your business.
3. First appearances are important
First impressions always matter, whether you’re meeting a buyer for the first time or how your business is presented to them online. When it comes to selling your business, one of the best ways to get your asking price is to attract the right buyers. Your business needs to pique the interest of potential buyers. This means that it needs to be presented well to them. This comes from an effective marketing strategy. Usually, your broker would analyse your business, compare it with competitors and create a marketing strategy that fits the industry and makes your business stand out.
4. Source quality buyers
Sometimes, good marketing isn’t enough. Your business needs to be placed right in front of the right buyers. This is another benefit of hiring a business broker. Brokers who have been in the game for a while typically have a wide network of investors and buyers to whom they can advertise their business directly. This means you could get a quality buyer sooner than you think.
5. Take care when structuring the deal
Lastly, take care how you structure the sales contract. Even if you have a broker structure the sale for you, ensure you know that sales contract inside and out. This isn’t to say that your broker can’t be trusted, but more so to encourage you to be responsible for the details of the sale, in case there’s a clause you may not like. Here are some important components of a sales contract that you should consider:
- Would the potential buyer require a down payment?
- Availability of finances
- How the transaction will be structured
- Whether you have to sign a non-compete or not
Looking for a broker?
One of the first steps to selling your business is to get a good broker on the job. If you’re unsure where to start, here’s a helpful page from Lloyds Brokers in Melbourne. As professionals who’ve been in the industry for a while, they have the skills and know-how to sell your business for a reasonable price and promptly.
Final thoughts
Selling a business can be a trying time, especially if you’ve built it from the ground up; seeing it go can be challenging. This is all the more reason to ensure the sale is done properly so you can get the best return on your investment. Consider the tips above and follow them as you start preparing your business for its sale. We’re confident that these tips will help you get it done right.
