“How to Get Your Business Ready for a Sale—Before You Plan to Sell: Part 3” is the final post of Carol’s three-part series on the Bank of America Small Business Community about how to make a graceful – and profitable – exit from your business. Carol begins:
Preparing for a sale can add substantial value for you as a seller, if you do it early and correctly. Part 1 of this series covered transition plans and management incentives, and Part 2 covered key financial decision making and organization.
Once you have familiarized yourself with those steps, continue with the important steps outlined below.
Create a Future Strategic Plan
Nobody wants to buy a business that’s best years are in the past. Understandably, buyers pay more for future opportunities and growth.
Even though you may be ready to sell your business, you need to demonstrate your business has plenty of opportunities ahead of it. Therefore, it is important that you create a three- to five-year strategic plan.
This will help you identify opportunities and issues to address prior to selling the business and give potential buyers a roadmap to future growth prospects. The more opportunities and growth you can demonstrate to a buyer, the more value they will place on the business.
Beware of Making Unnecessary Investments
If you are contemplating a sale, resist the urge to make investments that aren’t required to keep the business operating or those that may not show a financial benefit in the short-term, like an acquisition.
If you are planning an exit within a few years, it is risky to have to integrate an acquisition successfully on a short time table or pursue a brand new and unproven operating strategy. This is as important a time as ever to make sure that the rewards justify the risks.
You can read the rest of the post here.