Buying a company may not be as simple as buying a car, but in some ways, a business is like any other commodity: subject to the law of supply and demand. This can have significant implications for owners who are considering divestiture from their business in the coming year.
Over the past few years, there has been a marked uptick in small businesses going up for sale as Baby Boomer entrepreneurs decide it’s time for retirement. While this is good news for younger buyers who may want to acquire a company of their own, it means that sellers cannot count on necessarily being able to name their price.
If you’re considering selling a business in the coming year, you should consider going through an experienced brokerage like Beacon Mergers & Acquisitions to help you navigate the sale in a way that helps you understand where the greatest value of your company lies and ensures a smooth transition.
Advisory Services Can Help You Maximize Value
Knowing when to sell is important, but it’s also essential to know what condition your business should be in before you decide to sell. Most buyers want to see that your sales are stable or growing, and if your profits are in decline, or major expenses are on the horizon, your bargaining position will be significantly weaker.
The first thing most brokerages will do is valuate your business and determine what its current market price should be. Once they know what your business is worth, they can advise you on the best strategies for appealing to potential buyers and increasing the value of the sale.
Brokerages Preserve Confidentiality
In order to avoid disruptions to your business and workflow, it’s always best to keep a sale quiet until closing. While an ownership transition will always involve some changes here and there, you can minimize uncertainty by marketing your business confidentially.
Protecting confidentiality also helps avoid leaking sensitive information about your company to the world, which can damage the confidence clients and shareholders have in your business and spook interested buyers. Business brokers can create a blind profile to market your business and will identify and reach out to ideal buyers on your behalf. This helps keep the sale private and can also help ensure a speedier transaction.
Skilled Negotiators Help You Get the Best Deal
Valuating the business and confidentially marketing it are important ways brokers can help you prepare for a sale, but one of the most important services they provide is deal-making expertise during the negotiation itself.
Not every business owner is skilled in the kind of sophisticated negotiation tactics that are necessary for getting the best price, but the team your brokerage puts together on your behalf will. This takes the stress out of the process and gives you the expert counsel needed to discern the difference between a good deal and a great one.
Even before the Coronavirus pandemic upended the global economy, people interested in buying small businesses had no shortage of options. And while it is still not clear how the pandemic will end and when the economy will stabilize, it’s clear that the new normal will probably include fewer small businesses.
This means that if you’re planning on selling, you need as many resources as possible at your disposal to ensure you get a good deal. If you’ve invested your life’s work in growing a small business, the last thing you want is for that profit to evaporate when you need it most. That’s why it’s best not to take any risks, and work with professional business brokers to get the most out of the sale.