Do you want to sell your business? Have you studied the market and wrapped your head around current trends? The issue is that business owners wait for years to sell their business. They wait for the market to become healthy so they can fetch a good price.
Unfortunately, some of these business owners miss out on opportunities while they wait. Keeping that in mind, we are sharing a few tips that will help you sell your business:
1. Understand your buyers
According to a recent study by IBBA, Businesses that have value over $500.00 to $1,000,000 find their buyers from their vicinity. Some find these buyers within a fifty-mile radius, where most find them within twenty.
Thanks to the rise of business valuation, other companies, and investment firms are interested in buying their rivals. Most of these buyers aren’t local. In case your business is worth more than $5,000,000, then you will find your buyer from more than 100 miles away. It’s true in 77% cases.
2. What it teaches us
It suggests if your business is worth $1,000,000 or less, you will most likely find your buyer locally. Your buyers are buying a business for the first time. They are looking to maintain an already established business.
So your marketing effort should address any concerns they have about your business. They don’t want to take the helm of a sinking ship. But if your business values more than $1,000,000, then you need to address the concern of financially driven buyers.
When it comes to businesses that value more than 5 million dollars, the potential buyers own at least a part in a private equity group, or they already have an established company, and want to make a strategic acquisition.
3. Search the market
Most business owners sell their businesses to the first person offering the right money. But once the buyer starts calling, the seller realizes they should have priced their business higher.
For example, the seller invested 20 years to build his business, they have put a considerable amount of time and effort into building it. Yes, they are not happy with someone paying some money and putting their name on it.
The seller doesn’t know whether the management team will keep their jobs or not. Maybe if they planned their children would work in the business for some time.
These are legitimate concerns, and you need to address them in your marketing and negotiations. If you have a business broker, you have to mention these things, so you don’t come across the wrong buyer.
4. Have realistic expectations
When it comes to selling a business, don’t be too optimistic about pricing. This is a critical error, and it’s a common mistake people make. No one will treat your business the same way you did. So, get over it!
Before you find a broker to help you navigate the marketplace, you have to refer to searchable databases of businesses on sale. It will help you understand the current pricing trends. Many online sources will help you out!
Image Credits: Selling tips from Khakimullin Aleksandr /Shutterstock