There comes a time when every business owner needs ‘out’. Deciding to sell your business is a big decision and one in which you will need expert help from an experienced business broker. Getting the best price for your business will be top of your list. However, you may be wondering when is the right time to sell? Is there such a thing as ‘the right time’? And, is the decision to sell based solely on market or trading conditions?
A major contributing factor on whether the time is right to sell depends on your own personal circumstances. Running a business is rewarding and exhilarating but it is all consuming. It occupies your every waking thought; it is rewarding, yet stressful.
The likelihood is that you are also wearing may hats – accountant, book-keeper, human resource manager, CEO, cleaner… - the list could go on but the point is that running a business in which you are spinning all the plates, wearing all the hats and making all the decisions can leave you feeling drained. When running your business is no longer fun, when you walk in to your office with a feeling of dread, when it no longer excites or challenges you, the time is right to sell.
You don’t have the necessary skill set
This can often be a difficult thing to admit but sometimes, the company has outgrown its founder. On one hand this is great news but on the other, it can mean trying to hang on whilst floundering and flustering. The entrepreneurial spirit is not one that can be bottled, bought or taught. It is inherent, it lies just beneath the surface with some people using it to spur them on to take risks, fail and succeed. You may be a great sales person, you may be a great leader but ask yourself this – if your company was to double or triple in size, would you have the skills set to provide all the different styles of leadership that it needed?
However, this doesn’t mean that you cannot take your business on to bigger and better things – just be honest about whether this is something that you can do. If it’s not – then perhaps it’s time to let go.
The market is telling you to sell
One attribute that anyone with a business needs is a deep, innate understanding of the marketplace in which they operate, and any changes that could be coming their way – good, bad or indifferent. For example, a well-known high street company that loaned films on videotape may have survived if it had seen the oncoming trend for streaming services online, and if it had got in on the act.
The important thing to note is that if the market of moving against you, recognising this as early as possible and then selling early, means that as much value as possible is kept in the business. And making sure you get a profit on the blood, sweat and tears you put into it is surely the reward you seek.
Opportunity comes knocking
Regardless of whether you have an exit strategy or not, there are times when an opportunity seemingly pops ups out of nowhere. In many ways, this is the opposite to the point we have just made – as much as the market can move against you, it can also be a tidal wave of water rushing in your direction.
On this crest of a wave, comes a lucrative offer from another company to buy your business – or, if the market is strong and your business is viable, there could be an influx of interest and opportunities – and unless you really dig your heels in, seriously considering the offer is probably worthwhile.
By Gary Edwards, Marketing Manager, Company Valuation Services