Gannett News Service
Thinking of selling your business?
Here are some tips from valuation expert Chad Simmons’ publication Business Valuation Bluebook:
Secure the location.
Location is an important driver for many businesses, so you need to develop assurances that this won’t change after the sale. If the property is leased, renegotiate the terms with options to renew. If the property is owned, withdraw your equity and refinance. Increasing your cash reserves will be helpful during the selling process and, if the buyer wants to acquire the real estate, too, the financing is already in place.
Clean up and fix up.
Make your business shine, both fiscally and physically, by selling off dated inventory, attending to repairs or equipment needs, and releasing nonessential personnel.
Prepare to transfer the know-how and how-to.
A buyer may be unsure of his or her ability to run your business after the sale. You can assure him or her by offering a training program, which includes a timetable to explain the basics of how your business works.
Increase visibility.
Increase revenue and a larger market share are key to attracting a buyer’s attention. You can do this by increasing advertising and marketing.
Conduct a due diligence.
This can be a brief summary or an extensive business review. Either way, it must be done in preparation for a sale.
Determine the business price and exit strategy.
Price affects the desirability of your business more than anything. Price is what you control. If you want to sell for the highest price in the shortest time with the least effort, be realistic about your business value; then select the most tax-efficient transaction structure.
