The process of selling a business can be excruciating, especially in an unpredictable economy. Desperation can oftentimes cloud good judgement, leading to poor decisions and mistakes being made — ones that could easily have been avoided in the first place. The end result can be thousands of dollars down the drain, alongside years of dedication, hard work, and investment.
But the fact of the matter is that selling a business doesn’t have to be a painful process — if you do it right. If you can avoid these common mistakes when selling, frustration over finances and any disappointments are sure to become a distant memory.
Avoid These Mistakes When Selling A Business
Mistake #1: Poor preparation
Failing to properly plan can be detrimental to the success of the big sell. It can take as long as a year (or more) to sell a small business, but the matter can also be done in just a few months with the right planning. Ensure a smooth process when the time comes by maintaining updated records, keeping a detailed business history, and having a solid sales portfolio. Have a well-trained staff and do any necessary clean-up work before listing or selling — this includes looking at expenses, organizing the books, resolving any pending litigation, and making any necessary structural repairs.
Mistake #2: Not seeking out the help of skilled professionals
While the DIY approach might fly for certain home projects, selling a business is another beast entirely. You’re an expert at your job, but you’re probably not an expert at selling a company. It is a complicated process, so be sure to seek out sound business and legal advice from trusted experts. Finding the right business broker or consultant can be a crucial component of your success, as they are trained in the buying and selling of businesses. A broker will be with you every step of the way, from starting the selling process to closing the deal to everything in between: listing, marketing, identifying potential buyers, the list goes on. And truth be told, hiring a broker doesn’t equate money out of your pocket. Actually, it’s quite the opposite, as at the end of the day, they are there to help you get top dollar for your company.
Mistake #3: Setting the wrong asking price
Requesting too much for your business and being unrealistic about its worth can lead to disappointment and zero buyers, while setting the bar too low leaves you selling yourself (and your business) short. Conducting a detailed valuation is an integral part of the selling process and is one of the many items a business broker can take off your plate to ensure a successful sale at the right price.
Mistake #4: Being unavailable and disengaged during the selling process
While the right broker can provide essential guidance and direction along with bringing in prospective buyers, you will still need to do some leg work when it comes to selling. No one knows your business better than you do, and most buyers want the reassurance that they won’t be immediately abandoned after closing the deal.
Mistake #5: Not identifying the right potential buyers
You don’t want to waste time on the wrong buyers. If a potential buyer is not pre-qualified or doesn’t seem prepared to make an offer, move on. Consider the best person to buy and run your business, and make the right choice for the long-term.
Mistake #6: Lack of confidentiality
If word gets out that you’re selling your business, it could hurt sales in the interim, and in turn, affect the overall value. Take certain precautions and be as discreet as possible about your decision so as not to lose vendors and/or customers. A good broker will be well versed in maintaining confidentiality.
Don’t make these same selling mistakes — contact the Jacksonville Business Broker today to learn more and receive a free and confidential business valuation.