Around the Web: A Week in Summary
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A recent article from Columbus CEO entitled “7 things to consider when selling your company” explains seven important things to remember when selling a business according to wealth planners and business owners.
Despite the impact of the Coronavirus, the M&A market has not ceased transactions. The reality is that baby boomers are still considering retirement and 45 percent of business sales are considered opportunistic. This means that it’s important to be prepared for a sale in the event that an offer is made.
Here are 7 things to consider:
- Ask yourself: Am I ready? – Being emotionally ready to walk away from the business is one thing, but the numbers are another. Before you decide it’s time, be sure that the financials align with your post-business owner goals.
- Get help – There are professionals who excel in these areas just like you excel in your business specialty. Use their knowledge and networks to your advantage.
- Be ready for opportunities – The more prepared your business is to sell, even when you aren’t seeking a sale, the more you can capitalize on a deal if one is to be presented to you.
- Get your financial house in order now – You should always be running your business like you’re going to sell it next year, even if you aren’t planning to sell for another five or ten years.
- Plan for your employees – Selling your company impacts your employees, and your employees impact the value and transition of your business. Be sure to plan for both.
- Know your value – Many owners are unclear on the actual value of their company. Get a valuation done so that you are fully aware ahead of time.
- Trust yourself – Bringing in the help of professionals is important, as is doing your due diligence and tracking the numbers. However, you must also follow your instincts since ultimately the final decision falls to you.
A recent article from The Press-Enterprise entitled “Small business quandary: Should I continue or sell?” provides tips for business owners trying to determine the steps to take during the COVID-19 pandemic.
As a business owner, if you are struggling right now, you are not alone. Despite the pandemic, your business likely still has value. If you can determine where this value is, you may be able to retool and continue on, or you may be able to receive the best potential sale price for your business. The way in which you approach the pandemic will depend on which of the following three categories you fall into:
- Independent Contractor: You may be able to rework your services to be available online. You might consider applying for unemployment under the CARES Act.
- Small Business Owner: If you have a brick-and-mortar location, employees and physical assets, you want to determine your going concern value. This means determining the value of both your tangible and intangible assets combined. If you can continue business while social distancing, develop a plan to do so.
- Entrepreneur: If you’re in this category, you may view this pandemic as an obstacle to overcome since your whole career is based on finding a need and filling the void.
Regardless of what category you fall into, don’t make any decisions based on emotion and utilize the help of trusted professionals.
A recent article from Security Sales & Integration entitled “Big Idea of the Month: Your Business Should Always Be for Sale” offers the advice of a business owner who successfully sold their business in alignment with their goals.
Michael Marks attributes many things to his success a business owner. One of his goals from the beginning was to sell his business before January 1st 2020. While he suggests creating a successful, profit-driven organization, his big advice is to always treat your business as if it’s for sale. You don’t necessarily have to seek out buyers but you should always be willing to listen when an offer is made.