Step 5: Know The Numbers In Your Business - Pt 7

Buying & Selling A Business

Buying a business or selling one, each of us wants the best deal possible. If you are running a business now, then make it one that is reaching the potential it has so that you can command the best price when you sell AND make the most of it while you are running it.

If you want someone to buy your business, understand, they are not going to want to spend any more than they have to for it. So ensure that your business looks appealing by having it ‘sale ready’ at all times. This may take some time to accomplish, so start now, and begin working on those areas that are taking away from the value of the business to someone else – and to you!

Start by knowing what your business is worth right now and work from there.


Succession

This really relates to the previous topic on buying and selling business. In some cases, a business owner will wish to pass the business on to a member of the family, or someone else.

If you want to pass on the business, then:

• Will they have the money to buy?

• Who else would have the money and be interested in buying?

• How will you get paid for your business?

And if you sell the business to one child in the family, what about the others? There is much to consider when looking at succession within a family, and in the marketplace generally. Not everyone with the skills to run it may be in a financial position to buy it when you want to get out. If your children buy it, will they have to deprive the business of money to do so? Or will you face a miserable retirement because you don’t want to ask for the money you are due?

Succession is something to consider at the very beginning of starting your business, since the decisions you make along the way can be affected by the outcomes that you seek to generate. If you haven’t done this already, then do it now. Revisit your exit strategy every five years forward and ensure that your management plan is on track to achieve what you want in terms of final price and profit today and tomorrow.

Set your targets, and prioritize and recalibrate your budget and spending as required to be consistent with your aims.

Your exit strategy should be incorporated into your plan for the business, from the day you start. Revise over time, if your intentions or circumstances change.