| If your business is a success, you probably
had to pour most of your time, energy and money into it for what may seem like forever.
You may see your company as an extension of yourself and it may be hard to even imagine
life without it. In some cases, your entire family may have depended on the business,
discussed it endlessly around the dinner table and practically made it into another family
member.
On the other hand, your business may have only been
marginally successful. It's something you can't wait to sell and get rid of. Or, perhaps
you entered into the business with the idea that it would only be a short-term opportunity
and that you'd sell it whenever you got a decent offer.
Whatever your situation, selling your business will be one
of the most important things you'll do as a business owner. Unlike virtually every other
business decision you have made over the years, you'll only do this once. You get a single
chance to put a price tag on possibly years and years of effort. Once you sign the
business sale documents, it's over.
So, now the question is: Is now the right time to sell your
business for maximum profit?
3 Timing Factors That Will Affect How Much You
Will Make from Selling Your Business
1. The Economy – What's going on with the economy?
Is the economy growing? Is it kind of hanging in there? Are
we in recession? If it's a growing economy, that's great news for you if you want to sell
your business for the maximum price. If there's a recession, then I strongly suggest
waiting if you can. I'm not saying you can't sell your business for the maximum price
during an economic downturn, but it's much more difficult. So you need to be aware of
what's going on in the macro, in the wider world.
2. Your Industry -- What's going on in your industry
sector?
Just like the economy, if your industry's outlook is
growing strong, then now is the best time for you to sell your business for the maximum
price. Once your industry matures, the longer you wait to sell your business, the less
money you will make from the sale.
When keeping an eye on the industry, you must also look for
warning signs, alarm bells and problems in the brewing stage. This includes talks about
introducing new legislation either now or later that can affect your business and your
exit strategy.
3. Your Business – What's going on with your
business?
Before you decide to sell your business you must ask
yourself: Is the business growing, each year? Are you growing in turnover? Are you growing
in profit? Is that going to continue? If you've got historic growth and the growth is
continuing, then you have a wonderful business selling opportunity.
If your business is static or even worse stagnating, going
backwards, and struggling to break even then you need to be aware of these facts. It
doesn't mean you can't sell, but the preparation is probably even more critical because
you need to sell and you need to create a good story why you're selling.
Hitting the Jackpot – When is the Ideal Time to Sell
Your Business?
Obviously, the perfect time to sell your business for
maximum profit is when the economy, your industry and your business are all growing at the
same time. When you're prepared and ready to sell, then you can control that process and
wait for all three to coincide.
When you're not prepared and when you possess a victim
mentality then you sell because you have to sell. All three timing factors will not be in
place, and you will not sell for a maximum price, unless you get really lucky.
So, how are you going to start preparing to sell your
business? |
