When it comes to business, often the same amount of strategising, if not more, goes into selling a company as it does into starting one. With the sale of small businesses on the up and the recommended timescale for selling being, on average, two years, then if you’ve reached a place where you’d like to venture on to bigger and better things, now is probably the perfect time to start planning the sale of your asset.
As is the case with starting a company, selling a company takes vast amounts of careful planning, time and patience, and there are so many factors to consider when you do so, especially if you want to receive a healthy amount of profit. After you have considered the obvious, such as your intended timescale from start to sale, whether your company fits in the current market trends and whether the financial climate is suitable at present, then it’s time to delve a little deeper and start to ask yourself some more serious questions.
Consider Your Target Market
As a young entrepreneur, you will most likely already have a keen idea in your head of the type of clientele you will be pitching your company to. If not, then it’s time to establish who your target market is. Whether you established the company yourself or purchased it from someone else, it is no doubt something you’ve worked hard on, and of course you want it to continue to flourish. Do a little research on potential buyers, as this will give you an insight into what they will be expecting when investing in something as big as a company.
Consider what your expectations were when you took the plunge with this company. You assumedly had a barrage of questions you wanted answering, and whoever you pitch the company to is sure to ask the same and more. Prepare yourself, try and remember everything you wanted to know, include questions about things that you’ve learnt the answers to more recently too.
- What did you hope to achieve when you started the company?
- What steps have you taken to achieve and succeed?
- Why should your intended buyer make the investment?
- What is the company profit margin on average?
Don’t be Afraid to Ask Questions
When you started your company, you no doubt turned to experts in the field for their advice, and when you decide to sell it should be no different. Perhaps it’s someone to go over your accounts with you, a bit of inside knowledge from the owner of a similar business to yours or even just from a company such as Axis Partnership who can help you to sell your business. There is sure to be someone out there who can offer you some honest advice and provide the answers to at least a few of your questions. Don’t be afraid to ask questions, as people are often friendlier than you’d expect and are usually more than happy to help.
Honesty is the Best Policy – But Focus on the Positives
Of course, because you are selling something as big as a company, potential buyers are going to want to hear figures and nothing will be left unturned. Perhaps business was a little slow at one point or another - most likely when you were first establishing yourself - and of course you must be as honest as you can, but make sure you focus on the positive aspects of your company, and provide as positive an explanation as you can as to why certain things were maybe consistent in how they played out. People respect honesty and they’ll no doubt find out the truth of their own accord eventually anyway.