How to Decide When to Sell a Business

Selling a business, particularly one you have built by yourself, can be a traumatic experience. Here are some key points to consider in making a decision about whether to sell.

Difficulty: Moderately challenging

Instructions

Things You'll Need:

• Business Broker Specialist

1. Check your motivation. Reasons may include disability, death, burnout, desire for greater profits, relocation, other interests, divorce, disinterest in the business model, family pressure or a sheer lack of skill at the business.

2. Check your timing. You may plan for a long time to sell the business, working for years to achieve one that is attractive and salable, someone may make you a great offer out of the blue, or a family or personal crisis may drive your timing.

3. Consider selling the business but arranging to continue working there, if you still have your heart in the business but don't want to run it anymore.

4. Decide whether you want to sell, and if you do, meet with your accountant, lawyer and spouse, individually or together, to determine the best time and process for selling.

Tips & Warnings

• If family is involved in this business, bring in a family business consulting firm to help inform your decision.
• Create something else positive that you can move into after selling so that it won't seem as big a loss.
• No one can be objective about their own business. Hire a business broker to help you look at the value of your business objectively.
• If your business is driving you crazy and not making you any money, it's not very attractive for selling purposes. Be realistic about what you'll be able to get for it.

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[jycmba]

on 9/11/2008 Yes, having an idea of the value of your business is a key starting point - without this, how would you know whether the sale would meet your needs and desires? or if you should postpone and work on improving your business for a better exit value?

A certified business valuation or appraisal typically costs from $2500-5000 on up to $10,000-15,000 -
www.go-iba.org

However, this can be beyond the reach of most small business owners.

Contacting a business broker can provide you an "opinion of value" - while it may not be as comprehensive as a full-blown appraisal, this may help you have a ball-park range of values to work with.

In our state, the California Association of Business Brokers (CABB) - www.cabb.org - is an organization with full-time professionals in this field that can assist you. Your state should have a similar group.

Although ultimately the sale of a business

on 11/22/2005 Want to get out on top? You may have more assets to sell, and they may be worth more than you realize: www.tradeyoursite.com auctions businesses, entire or part (any assets, even intangibles). Free to buyer and to seller; it gets a commission off sale.

on 11/22/2005 If you are going to sell your business, do not simply rely on your financial statements. You need a business valuation to accurately represent your business' worth. A business valuation is a process that determines the fair market value of a business.