Ready to sell your business?
Ready to sell your business? Who will be your prospective buyer?
Now you are ready to part with your business, you should advertise in target areas for prospective buyers. Think back to when you first went into business for yourself, what made you make that leap to become your own boss. The chances are those looking to buy from you will be doing so for the same reasons as you did. Generally people buy or start businesses for a small amount of reasons.
- Obviously being your own boss is #1 reason.
- Then there will be those who have been laid off from previous employment and decide to try to improve their employment security.
- Many will be dissatisfied with their present employment and will look for a business that will combine their hobby or passion into a viable financial solution.
- Also there are those who have taken early retirement, now wanting to have a means of income without working so many hours.
So who is the average buyer, who fits the profile?
The world of business has been traditionally dominated by men, so it is most likely your buyer will be male. Not that this is set in stone of course, the world is changing and more and more women are rising to the challenge. The amount of readily available cash they have to invest will be modest. But many are willing to mortgage their home or take loans from banks or family to facilitate their dreams. It will be most likely that this purchase will be their first venture into the world of business.
Those who wish to become rich by having their own business are probably delusional and should be avoided as potential buyers. Most will have a desire to improve their working life, with the possibility of making more money not a major consideration.
More likely it will be a desire to prove that they can do it, to feel that they can succeed. Those that have run their own business, unless they are a Trump, Gates or Buffet will know it is hard work and even they know those big names know the hill of success is a hard hill to climb. Satisfaction always comes when you make it.
Therefore when vetting potential buyers bear in mind:
- Their desire to become a business owner and all that it entails
- Whether or not they are financially qualified
- If they have a realistic grasp on what the business can offer them, either financially or realistic security.
The buyer’s questions you will need to answer
- What is the total cost to them in buying your business?
- Does that cost include any stock or inventory?
- What is the prediction for increased sales in future years?
- Can you advise them on how to increase growth and value to the business?
- Does the business have any outstanding debts?
- Is there any local competition and if so what gives your business the edge?
- Last but not least, what is the average annual profit that it produces?
The road to selling your business is not an easy road to navigate
Hiring a business broker to help you market, advertise, and reach potential buyers that have been financially qualified is a necessity that many cannot do without. Chris Kerth can help you get your business sold to the right buyer and help you get the price you want.