How to sell a small business and maximize its value

Making a decision to sell a small business can be tough. On the one hand, it can be exciting as you might be motivated to move to a bigger challenge, but on the other hand, it can be sad to say goodbye to your beloved business venture.

But in order to make the best out of the transaction, you need to plan the transition carefully so you can get the best price and have a smooth transaction. Here at Bizop, they provide complete assistance to you in the process of starting your business, let’s go!

Check your motivation

Before even listing your business for sale, reflect on the reasons that are motivating you to take that important step. Ask yourself: why do I want to sell the business? Is the business the best memento to attract potential buyers? And the most important one: Are you ready to let go of that business where you have invested so much time and effort?

You need to be aware that selling a business is not just a financial transaction, it’s an emotional roller coaster… so make sure to be ready to ride it.

Prepare your business

If you want to maximize the value of your business, you need to set up many things before listing it so you can have a smooth transaction. The first thing that you need to do is check the status of the financial aspect of your business. Make sure the financial documents are up-to-date. Potential buyers will want to see documents from recent years.

Improving the looks of your business prior to listing it is the next logical step. Maintain facilities, equipment, and any other tangible asset, everything should be working properly before you start showing the facilities to potential buyers. A good first impression can make all the difference.

Check the operational side of things and if you find any issues, make it a first priority to solve them as soon as possible. Once everything is running flawlessly, document everything, and create operation manuals for your successor so he can start running the business without your help as soon as possible.

Determine the value of your business.

If you want to attract serious buyers, you need to establish the right price for your business. There are different methods that you can use to set the perfect value. You can set it based on the earnings that your business has produced in the last months, applying a multiplier that depends on the industry where your business operates. You can also estimate the value of your business based on the value of the assets that you are transferring, your inventory and intellectual properties are included here as well.

If you are unsure about setting up a price for your business, hire a professional valuator to set the right value.

Find the perfect buyer.

Once you have everything ready, it’s time to start looking for the perfect customer. Some of the options for this are online platforms specialized in business sales, such as BizBuySell or BizQuest. You can also talk with professional agents who specialize in selling established businesses. Another good option is networking with your peers, they might know the perfect buyer.

Once you find the perfect fit, start negotiating the terms of the transaction. You will be required to sign a sale document, start the transfer of the assets, and make sure all documents are in order and that both parties are satisfied with the terms.

Closing points

Selling your small business it’s a complex process that requires time and planning. If you follow the steps on this guide you will be able to maximize the value of your business and give the buyer the best experience and a flawless transition. Remember that enlisting the help of professionals can make the process less stressful.

We wish you the best in the process of selling your beloved business!