Did you know that 50-75% of Businesses for Sale on the Market do not sell?
From our experience there are several reasons for why this happens, but the prevailing reason is the Business is not prepared to sell. You may ask, what is not being prepared...we will get to that.
Even more astounding is that according to the Exit Planning Institute, 75% of the Businesses that sell, have Business Owner regret that occurs within the first year of the Sale.
Preparing the Business for Sale includes the review of sustainable business structure, owner independence, growth potential, product and service portfolio, customer concentration, and industry profit margins. All of these factors are main reasons for potential Buyers to hesitate when it comes to closing a deal. From the Sellers perspective, a business value that does not meet the retirement needs are the dominant reason for Seller to pull out of a deal. This comes when the Buyer has a totally different understanding of the Value.
So lets get back to the beginning
What makes you as the Seller better prepared for the sale and life after the Sale?
the Sale of your Business should be part of your Business Plan. Not only when you are financial planning, but in preparation to achieve the best possible value. Another key point is to spend time to work on your Business, rather than in the Business. Lastly, Perceived Value versus Market Value is the main reason a Business does not sell. The Valuation is not simply a multiple of earnings, but many other factors need to be considered. To avoid Sellers remorse, planning for the life after the sale is an equally important step.
Let us help you
getting set for your retirement with the value you deserve, with a free consultation.