While it may seem like you’re abandoning your baby, the fact is that the endgame for many entrepreneurs is selling their business. You’ve turned your business from a fledgling newborn into a full-blown adult and you need to ensure you send it off into the world the right way. Your pride and joy matters to you and you need to make sure that you secure its future before you pass it off to someone else for the rest of its life. You should be sure to keep a few key things in mind when you do.
Know what it’s worth
You wouldn’t list a car or home for sale without knowing what a fair price for it is, would you? Of course not. But, believe it or not, there are a surprising number of business owners who actually think about selling their company and never bother to find out its total, real value. Sales, profits, future prospects, the number of current clients and many other variables all figure into the total value of a company. It’s much more than just your current holdings. Of course, you’ve got some sentimental attachments to your business so letting a third party set a fair value is probably a better idea and one that will give you a clearer picture of total value.
Take care of employees
If your company is your child, its employees are the lifeblood that keep it alive and well. A sale can make your top employees nervous and if they exit before the sale is finished you may not even be able to close the deal. Be sure that you let your employees know that they’re going to be taken care of. Compensate them, reassure them, and help them adjust to the possibility of working with a new owner.
Get your records together
You wouldn’t send your kid off to school without the proper records, and your business should be considered the same way. Buyers will want to make certain that they have a clear picture of your business and its finances before they even make an offer. Maintaining good records throughout the life of your business will simplify this process, but be sure you spend extra time on it when the sale approaches.
Know the buyer
When you start going into talks with a potential buyer, learning more about them is important. You’ll want to make sure your business actually appeals to their interests and, if you’re worried about your employees, that they actually care about keeping your business open and operating properly.
Plan for your successor
This is especially important if you’re really in charge of the daily operation of your business. You need to be sure that you delegate major responsibilities to your management team and that you ensure your business’ continued operation success after you’re gone. This way, the buyer will have confidence that the business can go on without you. It’s important to make sure things will carry on the right way after the sale.
Samantha Hurst has built up and sold several online businesses, and now runs a business consultancy Click Start Digital.