Things to do when preparing your business for sale... within a short-ish time frame.

Have you decided to sell your business? And you're wanting to list the business for sale within a relatively short time frame. Ideally businesses would have been preparing their business for sale for a long time (hopefully since the start of the business), but in most cases, for us all this has been easier said than done.

However, if you’ve ended up in a situation where you need to or want to sell your business quickly, but before you do, have you made sure that you have done the best you can, capturing the target market you want to sell to, and receiving the best possible return of your investment? Below I’ve written some no-nonsense tips to assist you whether you're going to sell with the help of a broker, consultant or privately. They aren’t time-consuming or costly; but these tips could give you the leading edge.

Here are my five most important tips you should take care of, three months prior to selling your business.

1.?????Are your accounts in order?

There’s nothing worse than being asked for your accounts by prospective purchasers and your reply is that ‘they’re not quite ready yet.’ Why not? Is it because you’re too scared that all the anomalies will float to the surface? Or have you just not got your accounts organised – yet? Not getting financially prepared gives allowances to prospective purchasers to ‘put the brakes on’ the sale or worse still propose a discounted sale price.

The financials are the core basis of any buyer understanding your business and making a decision on it. ?

Here’s what you could do:

·????????Get your accounts tidied up professionally by your accountant

·????????Recover any outstanding receivable payments from clients

·????????Consolidate any of your own business debt

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2.?????Build-up your ‘Sales’ pipeline

If you are a service based business, there is nothing worse than not having prospective or upcoming business in the pipeline. Getting as many quotes out as possible, proving to prospective purchasers that your business is an active ‘machine’ amassing leads for the future, lowers the perception of ‘risk’ for a potential purchaser. Secondly, ensure your client database is up-to-date and active. Be prepared to show potential purchasers your clients’ past sales histories – after all, this is potentially the ongoing-concern being sold.

Here’s what you could do:

·????????Enlist a virtual assistant to go through your database – if you, yourself don’t have the time, to add and subtract clients

·????????Make sure the sales history for clients is current – illustrating any current and future repeat business

·????????Ensure email and phone contacts are all current

·????????Call historic and current clients to get more work, and build up your sales pipeline.

·????????If you can get coming work under a signed contract, this will go a long way to demonstrate the value of the business and lower the risk for the purchaser.

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3.?????Trim, trim, trim – the unnecessary...

The whole idea of selling a business for the best possible price can only be achieved if the purchaser can see value in your business. Value means possible future sales, and cash in the bank. This isn't easy to achieve if expenses keep occurring from your business. One suggestion is to put the brakes on unnecessary expenditure. Cash in the bank is better than stock on the shelves (dead inventory), additional ‘plant’ or IT programs being under-utilised.

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4.?????Secret Squirrel or out and proud?

The default setting for many business owners is to be ‘hush-hush’ about the prospective sale of the business. The flip side is that its hard ot sell a secret, and therefore you might not get the most value for your business. The biggest fears in selling a business for many owners, is losing their staff prior to selling or what customers might think. Give this some careful consideration on if you could market your business brand, how you could get the staff onboard, and lessen risk with customers.

Here’s what you should do:

·????????Be honest and open – tell staff your intentions

·????????Create a business culture that is proactive in the months ahead of the sale period

·????????Get your staff involved and on board

·????????Get ideas from them to assist your purpose

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5.?????Advertise (better known as investing in the sale of your business)

You want the best possible sale price for your business, right? After all, think of all the hours you have spent creating and generating your business; from inception to growth, then to maturity... you want the best possible price for all your hard work – correct? It won’t happen if you fail to provide one deciding investment; advertising your dream. The point of advertising is for prospective purchasers to see exactly what you first saw in your business – the potential, the energy, the opportunities, the chance to be free – working for yourself. But without the skills of advertising – how will you gain the best outcome? You're selling what could be your biggest asset - Don’t skimp out on advertising budget here.

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Invest, invest, invest in advertising! I can’t stress that enough...

Don’t think your business will sell itself – it won’t.

Be proactive and make these positive changes in the three months leading up to your active sales’ strategy.

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Give me a call and let’s talk...

Yusuke Inui

[email protected]

????+64 (0)21 808 232