WHAT NOT TO DO WHEN SELLING YOUR BUSINESS.
Business owners often think that selling their business will be similar to selling their home. You put a price on it and hope that you get something close to that. You typically get the money in one lump sum and hand over the keys. Selling a business is very different, particularly because there is always a big difference between a “valuation” and a “deal”. The reality is that the moment you put a price on your business you know what you will never get – and what you do eventually get won’t even be close!
Another mistake people make is thinking that the only people who will see value in their business are their competitors…They may see the value in getting you out of the market, but it is very seldom that a direct competitor pays anywhere near premium for a business. You need to be looking for synergy, or a strategic acquirer, if you are looking to get premium value for your business.
Lastly, we always talk about choice as a cornerstone of our approach to selling businesses. However, this is often misunderstood by people embarking on this journey on their own. Just because you contacted five, or even 10, acquirers does not mean you got choice. All too often business owners do approach multiple potential acquirers, but they stop working on them all once one party starts to show an interest. This is not choice at all, and will quickly land you in the same position you’d be in if you had only approached one in the first place.
More from Andrew in the video clip below…