The proof is in the pudding. It’s not over ‘til it’s over. Don’t count your chickens before they’ve hatched. Pick your cliché. Just because someone makes an offer to buy your business doesn’t mean they have the resources to get it done. 9 warning signs your buyer can’t follow through:
Twenty years ago, when I started out in M&A, I worked with small businesses. At that point, my biggest hurdle was convincing business owners they needed a business broker in the first place. I had to show people the value an outside advisor could bring to the table.
As you start the sale process, you may be holding more offsite meetings and fielding confidential phone calls. Even a subtle shift in activity can cause savvy employees to wonder what’s up. Be prepared to answer questions about who these advisors are that are touring your business and why you’re requesting additional information from your management team.
The Estimate of Value (EOV) and Business and Market Analysis (BAMA) provides business owners with a realistic understanding of what the market would most likely bear for their company in today’s marketplace. Find out more about the Process!
As you build your company’s strategic plan, consider not only how to drive growth, but also how to reap long-term financial rewards. Most of your personal wealth is likely tied to your business. This means that maximizing your business’s value ensures an optimal return on your investment, helping you meet your financial goals.
Imagine your kids going to school, kindergarten through high school, without ever receiving a report card. As a parent, how would you know when they needed additional help? If they were ready for a new challenge? Whether you should help them prep for college or consider alternative training?
At the end of the day, it would be hard to make well-informed decisions. Your kids would go to school and put in the time every day, and you’d have no idea if they were doing D or A-level work.
There’s a difference between generating cash and building business value that someone will be willing to pay for. Here are a few ways to boost your future purchase price and increase your business valuation:
As you build your business, pay attention to what a future buyer will want. They’re looking for well-diversified customer groups where the loss of one account won’t have a devastating impact. Do the hard work of diversifying, and you’ll increase your future business value.
DealCoach's Estimate of Value (EOV) provides owners with a realistic understanding of what the market would most likely bear for their company in today’s marketplace.
If you’re one of the several million baby boomers thinking about selling their company in the near future, you might be wondering how long the whole process will take and what to expect along the way.
If you have a focused advisor who is working the deal, expect two months of initial prep, 30 to 120 days for marketing, one month for negotiations, and roughly 60-90 days to handle due diligence, financing, and legal. Here’s the process in more detail: