The decision to sell a business may not always be formed by the owner. If, for example, the company was not originally planned for sale and the decision to sell the business is not dictated by any urgent or force majeure circumstances, but the business owner sometimes has thoughts about selling the company, it does not mean that he has already made a decision or is ready to make a deal.
Entrepreneurs often have questions “is my business ready to sell? If so, how do you determine how much to sell your business for?”
Let's analyze the main questions to ask when selling a business.
Questions to ask when selling my business
№1. What is the value of my business?
This is the main question that an entrepreneur needs to answer before selling their business online, for example with website closers llc. If you find it difficult to formulate exactly what the investor should pay for, you will not be able to get out of the business quickly.
Traditionally, the seller of the company tends to overestimate the value of the business, and the buyer underestimates it. Even if you do not take into account external factors that can both increase the value of the business and significantly reduce it, each party to the business sale and purchase transaction seeks to maximize the benefits.
Therefore, the seller of the business needs not only to formulate clear price benchmarks at which he is ready to enter into a transaction but also to mathematically and economically justify why he wants such a price.
№2. Is it easy to transfer the business to a new owner?
When starting any business, its founders spend all their time on it, testing hypotheses and rebuilding the main processes. In the future, routine operations should be delegated to executors. If this is done and the management is heavily dependent on the owners, the value of the business, in terms of its sale, can sharply decrease.
№3. Is it the right time to sell the business?
Seasonal fluctuations in demand affect the value of an online business, especially if it is an online store. Try to sell the business in the "high season", and if it does not work, then collect detailed statistics showing the growth and slowdown of sales depending on the time of year, promotions, holidays, and other factors. In this case, you will be able to demonstrate to the investor that the natural decline in sales will be followed by a return to previous levels.
№ 4 Can I cope with the changes on the horizon?
Rapidly changing technology, increasing globalization and other business trends may prove too much for some business owners to handle. Train your eyes for three to four years and if you don't believe you can keep up, sell before your inability to adapt catches up with you.
№5 What liabilities should be closed before selling a business?
Any business has certain obligations in its activities. These may be various types of loans, debt obligations, settlements with counterparties, obligations to employees, partners, etc. Not all and no such obligations can be transferred to the new owner.
Therefore, in order to sell the business quickly and attractively in the eyes of the buyer, it is advisable to take care of all your obligations in advance. Reputation often costs no less than the business being sold. Therefore, the seller of the business needs to make an inventory of all debts and settlements in advance, and try to close all issues before the sale of the company.
Questions based selling - conclusion
Any business has certain obligations in its activities. These may be various types of loans, debt obligations, settlements with counterparties, obligations to employees, partners, etc. Not all and no such obligations can be transferred to the new owner.
Therefore, in order to sell the business quickly and attractively in the eyes of the buyer, it is advisable to take care of all your obligations in advance. Reputation often costs no less than the business being sold. Therefore, the seller of the business needs to make an inventory of all debts and settlements in advance, and try to close all issues before the sale of the company. By using these questions to ask for sale by owner, you can get out of your business as calmly and profitably as possible.