Over the last number of years I have been becoming increasingly frustrated with how little business owners, their families and professionals understand about the business sales process and how said process will affect them, their families and their business. Just last week we had a vendor that even after 8 months on the market, being offered a deal that was better than we indicated when we hit the market, the owner took the market feedback personally, lost his temper and decided he wanted more at the last minute and the deal has now fallen over.
This is my responsibility and was something we tried to work on during the process, but going forward we would like to work with business owners, and their families, at least a year before they might want to sell their businesses.
I am sure there are coaches that offer this type of service, but not likely from business coaches with over 15 years experience and with a history of over 300 transactions. Even though I have successfully completed this number of transactions I probably lost over 1000. This is generally due to lack of preparation, acceptance of the process, lack of understanding of the process and general mess inside the business. SBL wants to do something about this.
A business is often an owner’s largest asset, but an exit strategy is a little more complex than the sale of your other large asset, your home. Most people understand the process of selling a property but few understand the implications of how to sell a business.
There is often a significant psychological aspect to overcome in a business sale. Owners, especially Baby Boomers, feel their identity is entwined with the business and can feel a real loss toward the culmination of a sale process, and if this hasn’t been resolved before you go to the market it can manifest itself very nastily in Due Diligence.
All business categories have drivers, KPIs and market ratios etc. that discerning buyers are looking to identify. With our many years of experience we have built up a knowledge base of these areas that need to be identified and corrected in any business before it goes to the market. This process is designed to maximise the value of your business and create an attractive opportunity for when you’re ready to sell.
It appears to me that the disciplines any business should follow to make their business more saleable are likely to be the very disciplines required to make the business successful. Areas that hinder any business sale generally have something to do with the risk on the future maintainable income and mitigating any risk to the current or future income of the business should be equally important to the current or future owner of the business.
The ability of any business to be able to verify any and/or all representations made about the business is paramount to achieving the best possible result in any business sale. So a new owner of the business needs to begin preparing for a future sale from the day he/she takes over. We can advise what records you will need to properly extract the best possible result when you look to sell in the future.
We have developed a new coaching/mentoring service that helps get business owners, and their businesses ready for the market. If you’re interested in reading more information on how this process will work, see here, or feel free to contact us for an obligation free chat.