In every business, whether it's manufacturing a product, providing a service or retailing to consumers, those who are successful in making sales share some fundamental characteristics. They all have a well-planned marketing strategy featuring qualified prospects, a detailed product (or service) profile that highlights the product (or service) features, and a clear definition of the benefits of a purchase.
The same can be applied to selling a business. But when it comes to selling your company, you also have to factor in the personalities and motivations of both the buyer and seller. To ensure you sell for the best price to the right buyers in a timely fashion, employ these five additional strategies:
Ask a reasonable price. Too often, inflated prices discourage potential buyers from giving the business any serious consideration.
In my experience, sellers who inflate the asking price in an attempt to create some "wiggle" room will find that buyers don't give these businesses a second look. If they do, they are savvy enough to tilt the discussion in their favour, and negotiate lower prices because the lack of buyer activity makes sellers more anxious to discount the price.
A good litmus test is to honestly ask yourself if you would buy your business at the price and terms you're offering. If the answer is no, you need to reconsider.
Focus on day-to-day operations. Continuing to operate the business as you always have is critical throughout the selling process.
You don't know when a buyer will materialize, so the business's financial performance needs to remain strong. When a buyer does come forward, it will be important to both parties that the business is moving in the right direction before and after the closing date.
Those who let their firm's performance slide should expect buyers to view the most recent performance as the most reliable indication of present value and future success.
Maintain confidentiality. By interviewing and requiring all prospective buyers to sign a non-disclosure agreement binding them to complete confidentiality, all parties can comfortably communicate without impacting the business.