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Waiting Too Long to Sell Your Business
Business owners who are looking to sell often adopt a wait-and-see approach, which can be risky. Making a sale is not as easy as it appears, of course, but business owners who avoid waiting too long to sell their business may enjoy a more successful outcome.
Waiting too long to sell, or not planning ahead, can cause business owners to miss a valuable window of opportunity. Because it takes an average of two to four years to sell a business, long-term planning is necessary for any successful sale.
Never Wait Until You Have to Sell
One of the keys to a successful business sale is selling when you don't absolutely have to. If a buyer sees that you've been planning this move for quite some time and that it's not a desperate “I've had enough” step, you can dictate a much higher price. Proper planning means careful financial records, a detailed business history and an extensive sales portfolio.
Many business owners make the mistake of waiting until their business is on the decline to sell, which is exactly the opposite of what you should do. The best time to sell is when your business is at its peak, at the top of its game.
The Right Conditions for a Sale
In an ideal situation, a business sale would be completed when two conditions are met: when demand in the industry is strong, and buyers with deep pockets are available. It's a smart idea before selling to take a look at market conditions for your industry in order to achieve the best return.
Working with business brokers can be beneficial in this case, as they often closely monitor market conditions and can advise you on when conditions are favorable for your industry.
What Can Harm Your Business's Value When You're Trying to Sell?
Many factors can affect the asking price of a business, including industry competition, current market conditions and the overall economic climate. Events such as a recession or a business downturn can affect your business's value and lower the asking price. This is why it's beneficial to sell when the economy is healthy.
Of course, even in the healthiest economic climate, having too high an asking price can lead to a dead-end street. Deciding on the right price for selling your business is important, and it's one that business brokers can help you determine. They take a careful look at your overall profits, the state of your industry, similar businesses and the marketplace when choosing an asking price.
Consult a Business Broker
Contacting business brokers can help you sort out any problems relating to selling your business. They can help you figure out when it's the right time to sell, a proper price, and possible qualified buyers to set your sights on. Business brokers such as LINK help business owners avoid common mistakes that often arise when trying to sell a business. Contact one our LINK offices in Australia today to get started.