Selling a business is a complex process that often requires years of knowledge and experience. Most business owners will only sell their company once, therefore it can be difficult for business owners to fully understand and comprehend the entire sale process from start to finish…
In this article we will share the four most common myths about selling a business:
Myth #1 – I Can Sell My Business On My Own
Many business owners believe they know how to sell their business because they own and have been the key salesperson for their company for many years. However, selling your business is not like selling a product or service. It can be particularly hard for business owners to put aside their emotional attachment and need for expediting the sale which can affect buyer negotiations. Furthermore, confidentiality is lost, which means you risk losing clients and employees – the very goodwill you are trying to sell! This is where the services of a well-connected professional business sale expert can offer you valuable strategic advice and drastically increase your chances of selling your business for a higher price.
Myth #2 – I’ll Receive The Full Asking Price For My Business
The asking price and sale price are two very different figures. Before you list your business for sale, if you hire a business sale specialist, they will explain that any advertised selling price will be regarded by potential buyers as a starting point for negotiations. Therefore, you should expect to receive around 90% of the asking price for your business. If you go into the sale process with unrealistic price and terms expectations, you may expect to receive little to no interest in your business. Therefore, it is important you receive a business valuation before you list your business for sale.
Myth #3 – My Business Is Ready to Sell Now
Too often business owners assume that as long as their business is performing well, then it is ready to sell, with no preparation needed. This is certainly not true, especially if you want to maximise your selling price. The sales process will involve a rigorous examination of your business and its track record. Successful business owners often spend months and years positioning their companies, compiling financial records, and putting systemised processes in place to ensure their company is ready for sale.
Myth #4 – My Business Will Sell In a Few Weeks
While some businesses do sell quite fast, those cases are few and far between. Realistically, it can take a period of months to attract the right buyer and close the sale at a good price. A common rule of thumb is that it can take somewhere between six months to 12 months to sell a business. This may seem like a long time, but the simple truth of the matter is that it takes time to find the right buyer who will pay you an appropriate market price and to whom you will be comfortable handing over the reins of your business.
If you need guidance on selling your business or preparing your business for sale, contact us at sales@bizworks.co.uk
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