subject: Selling Your Business: What You Need To Know [print this page] Q. I plan to sell my business in the future. What do I need to know?
A. It's great that you're thinking ahead by planning your exit strategy now. If you're considering selling your business in the future,contact a business broker for an initial, informal business valuation. He or she will offer recommendations on how to prepare your business for sale. Preparing your business for sale is critical. It means addressing issues and concerns before putting your business up for sale. This will increase your chances of getting an optimal price for your company and make your business more attractive to prospective buyers. A business broker offers an expert perspective on what you need to do to make your business more saleable.
Q. How long does it take to sell a business?
A. In most cases, selling a business will take longer than selling a house or a commercial building. The sale is confidential, so there is limited marketing by nature, but the sooner you have all the information together for your Business Broker, the quicker he or she can begin finding the right Buyer for your business. Your Broker will constantly be sourcing and talking to potential Buyers. The time range for selling a business varies a great deal but, typically, it takes six to 18 months. However, some businesses may be on the market for a month, and other businesses may be on the market for years. A Broker can help you properly price your business, including arranging financing terms and a reasonable down payment and finding the right Buyer so you can avoid spending too long on the market.
Your business needs to be appropriately priced from the start. Often Buyers won't even consider businesses they believe to be overvalued, so you could miss out on potential Buyers if you price too high. Again, these transactions are down payment driven, so the amount of down payment is a critical component for getting your business sold.
Q. When is the best time to sell a business?
A. You want to sell your business when the business is healthy and generally doing well. Although it may be difficult, waiting until after your business has peaked is not the best time to sell because the price can suffer. Most sales will still occur, however, even if the business is not doing well. Talk with your professional broker who will advise you of the best time to sell and then price your business appropriately to ensure a sale.
