You’ve Decided to Sell Your Business, Now What?
Selling your business is no easy decision. Neither is the decision to transition into retirement. However, it means you’re about to embark on a whole new chapter in your life! You’ll finally have time to do all those things you’ve dreamed of but couldn’t do during your working years. You may be feeling a series of mixed emotions about your decision to sell, so how can you make the process easier on yourself and maximize your sale profits?
No matter who you’re selling to, you’re going to want to get the most value out of your business in order to maximize your retirement wealth. Just like we would fix up our homes and stage it before putting it on the market, the same theory applies to selling your company. Take a look around your business and find ways to upgrade before the sale. For example, software can be upgraded to its newest version, and repairing or upgrading machinery and equipment can make your business more appealing to the buyer. Not only do they get to enjoy extra years of depreciable value on your assets, but they’ll love that they don’t have to do the updates themselves which can mean a higher sale profit for you.
Review your financial records
Your buyer is interested in purchasing your business because it is well-established and successful, but can you prove it on paper? Your buyer will want to see records of your financial paperwork to confirm their decision to buy. Organized finances and ledgers give the buyer an opportunity to analyze the potential for growth and look for trends in your business from previous years. A well-organized system saves them the headache of filing and sorting statements and gives you a chance to review your finances to get top dollar as well.
Put yourself in the buyer’s shoes
Look around your business; are there things you always wished you could have changed? Even little features or issues that may have never bothered you can be a thorn in the side for potential buyers. So how can you make it easier for them and yourself? Put yourself in their shoes! Taking over your business is easier on both parties (and financially beneficial to you) if you take the guess work out of it for the buyer. Try some of these ideas to get started:
Create guides for the new owners with your current processes to help them continue with business as usual and identify ways they can improve them.
Try Implementing cost-cutting measures where possible – you would be surprised how much you can save by updating things around the shop or bringing in 3rd party services such as equipment maintenance in-house.
Limit risks in cash flow by increasing your recurring revenue; reach out to new clients, diversify your customer base and try to limit the variable expenses associated with your business.
Although the decision to sell your business may likely come with some sentiment, it is also a great way to fund your retirement savings and maximize your wealth. A well-documented, organized business is more likely to gain the attention of serious, interested buyers who are willing to pay top dollar for a business like yours. It’s important to start prepping early on for the sale to allow yourself time to enhance or fine-tune your business to make it more sought-after on the market. By doing so, you’ll also give yourself time to adjust to the idea of selling as well as an opportunity to implement changes that boost your profits during your working years as well as when it comes time to sell. Speak to Darryl Smith of Synergy Life Financial to help you find the true value of your business and help you maximize your retirement savings to enjoy financial freedom! Call (705) 434-0562 today and learn how to leverage your business and start working towards your well-earned retirement.