You’ll need to be prepared to spend time grooming your business so it’s in the best shape possible for a prospective buyer.
Most of the essential tasks are a matter of good housekeeping and don’t require a significant financial outlay or any specialist skills.
Think of it in the same way you’d prepare a property for sale:
Show buyers how well your business has been run by compiling accurate financial information
Buyers will take lots of different factors into account before committing to a purchase. The value of your business will come down to an evaluation of its current and potential earning power. This will require evidence of regular recurring revenue or forward customer contracts. Try to remove risk, where possible, by confirming contracts, leases and supplier arrangements.
Put yourself in your buyer’s shoes and consider the ways in which your business is ripe for growth.
Could unused space be employed to expand the retail area? Could existing resources be leveraged into creating a complementary business? Do your research and see if you can come up with a handful of ways to grow.
Paperwork in order
Prospective purchasers will want to see that all your paperwork is in order.
Show prospective buyers all the up-to-date documentation they need to help them make a purchasing decision
Streamline and automate processes so it’s easy for a new owner to start trading from day one.
It’s important to make every aspect of your business as straightforward to administer as possible so your buyer can imagine taking the reins without any hitches. At the most basic level, this involves establishing and documenting the procedures for areas such as purchasing, stock management and order processing.If you don’t have any systems, write down what you already do to create a documented set of processes.
Staff who are an asset to the business, will be an asset to prospective buyer.
Though employees aren’t tied to the company indefinitely a buyer will see value in staff who are happy and committed.Your staff could make the difference between a sale or no sale; so be honest with them and keep them informed of the sale.
Buyers are wary of a business that’s too reliant on its owner
Begin the process of removing yourself from day-to-day operations – even if you’ve always been its lynchpin. Think about how you could delegate responsibilities to the team. If you run a small owner-managed business, think about outsourcing tasks such as bookkeeping - you’ll be surprised how much you can remove from your plate.
Invest to add value
Consider investing in improvements before you market your business for sale
It may seem counter intuitive to splash the cash on upgrading your computer systems, updating your premises or upshifting your marketing efforts but a modest spend at this stage may seem like a wise investment if it gets you a better sale price – and keener buyers. Set aside some time and effort to getting every aspect of your business just so and it could pay off handsomely when you come to sell.