Many business owners work long hours and sacrifice family time for the majority of their life to ensure their business runs smoothly and the money keeps flowing. For most it’s not just a job but a passion. An entrepreneurial spirit that needs to be fed. Often, this hunger and drive comes at a high cost and there comes a point where passion and wealth no longer outweigh mortality, health, family, friends and life and the conversation about selling your business becomes a topic. But should you wait until then?
The simple answer is no. Not if you want to maximize profit, be able to leave when you chose and ensure you and your employees are taken care of. A good rule to follow is to have a long term plan and to sell when business is still projected to rise, not fall. Mortality is a forgotten factor in business ownership and due to it’s sad nature, not spoken about enough. Often, we long for bigger and better things but obligations keep us tied in place.
In this video, Gina Gonzalez, a Business Broker, discusses the selling a business checklist business owners can follow in order to be prepared for sale, should the right situation arise.
So, are you ready to put your business for sale?
Try this checklist:
- You have achieved your business goals for your company
When a company is started the owner and possible investors have goals they’d like to achieve. While these goals can change over time and should, there will be a point in the growth of your company where you find that you have achieved what you had hoped and possibly more. At this point, you don’t want to start developing a new product, open a new store or launch a new software.
- You have achieved your personal goals for your company
Business goals are one thing but often when you start your own company you have personal goals. Leaving your mark as an inventor, becoming an expert in your industry, develop an amazing work culture, provide enough money and stability for your family and many more.
- You want and need to spend more time with your family
Your parents, siblings, wife, children have supported you throughout the years and have been understanding of your lack of time, your unavailability on weekends, vacations, sports events and movie nights. But it’s time and they need you.
- You are financially stable, or will be when you sell
You have reached the upwards point in your business, are making a profit and you can sell for a nice payout. Don’t wait till your business isn’t rising anymore or on a downward trend. It will affect your payout.
- Your dog misses you and you find yourself dreaming of fishing and hunting trips
David Mahmood, Founder of Allegiance Capital Corporation once told me that men love their dogs, fishing and hunting and that they long for time with them. Away from the stress and hustle of business. Your dog will always love you and be loyal, don’t wait until it’s too late and your loyal friend can no longer go with you.
- You aren’t as productive as you should and want to be because you find yourself unmotivated and are dreaming of far away places to visit
That is one of the best indicators that it’s time to move on. When you love your career and your business, when you are still passionate, you don’t have time to think about places you’d rather be. When you find yourself dreaming of the Bahamas, a cruise or even something as simple as golfing, take your bodies and minds hints.
- You want to retire in the next 5 years
Why should you sell now? 5 years is still a ways away right? Wrong. Selling a business is a lengthy process and finding the right buyer takes patience and time. Additionally, buyers often require the owner to stay for a few years to oversee and assist with the transition process.
- You want to be a "free" person in the next 5 years because you have another idea for another business
As previously mentioned, the process is a lengthy one. You can start with a partial sale of your current business to have a starter capital but be aware that to fully be involved you may want to plan ahead.
- You haven’t been in the office in 2 weeks.
No, this is not as self explanatory as it sounds. Sometimes owners travel, have lots of meetings and especially in bigger companies there are other people in charge who can handle it. However, if you have nothing major going on and have just not had the desire or drive to go to your office, it is another good indicator that you are ready to sell.
So how many of these items above did you find yourself agreeing with? You may not initially notice that you are ready and you could still be in the phase of "denial" but if you agreed or sympathized with 4 or more, you should look at your options. Nothing lasts forever and you should always sell on the way up, not down.
If you are a fairly new business owner, selling your business and retirement appear far away but know that it is fast approaching when you love what you do. Be prepared and have an exit strategy in place.
- Selling Your Business – A Personal Perspective
- Due Diligence Checklist
- How Long Does it Take to Sell a Business
About the author: Deanna Ayres is the SEM Strategist and Community Outreach Supervisor at The Marketing Zen Group. She loves to come up with new content strategies for and with her team and believes that connecting on a personal level is vital to success. Growing up in Europe has allowed her a unique insight into cultural differences in business & marketing. In her spare time she is a photographer, hobby cook with a love for coffee, gamer and geek.