SELL YOUR ADS HERE

Are You Ready to Sell Your Business

Make Sure You Understand Your Motivation for Selling

Are you thinking about selling your business?

This simple one-question quiz will help you to better understand your motivations behind this thought. A better understanding of your underlying motivations will help you make the right decision.

Select the answer closest to your actual reason for thinking about selling your business.

A. "I'm selling my business because of the money I will make on the sale". B. "I'm just tired and it's not fun anymore." C. "I have too many irons in the fire and can't keep up". D. "I'm ready to retire from owning my business".

A. "I'm selling my business because of the money I will make on the sale".

This is rarely a good answer if it is the primary answer. Most small businesses sell for 1 to 3 times yearly cash flow after adding back all owner salary, benefits, fringes, interest and amortization/ depreciation.

Larger mid-sized businesses generally sell for to 3 to 7 times cash flow after deducting for the cost of executive management. While this sum can be significant, it is usually only a few times what you will make this year.

Continuing on with the business will usually make you more money in the long run. On the other hand if you have an offer in hand from a public company at 20 times earnings, take it.

B. "I'm just tired and it's not fun anymore."

This question requires careful digging into the reasons for the thought. If you are really ready to get out of the business, then it is a good reason. If the real reason is that you are just tired under the current conditions and as soon as things improve you will get excited again, think long and hard.

Often during the sales process your broker, intermediary, or other advisor will provide coaching to improve obvious defects in the business to make it more salable. Sometimes measurable improvements occur for the business. Suddenly the owner doesn't really want to sell now that things are moving again.

This is a bad situation for everyone. If what you need is coaching to get out of a rut, hire a coach; don't sell your business. But, if you are really mentally done, sell the business before you completely run it into the ground.

C. "I have too many irons in the fire and can't keep up".

This is a valid reason to sell a business. It is a somewhat common occurrence for multi-location operators who either buy one too many sites or just end up with one or two sites that are too far away to manage.

Often the constant attention you must diverte to an under-performing site will lower earnings of the whole chain. Just remember when pricing the underperforming site for sale that if your not selling much in terms of profits or revenues your not going to get much in terms of price. An old adage that applies here is that the first loss is the cheapest loss. In this instance be prepared to take your loss and move on.

Another variation is the entrepreneur who has a new venture that is overtaking the older established business. Time constraints, management abilities, and variations in potential down stream financial returns may make it desirable to sell the older business. This can free up resources allowing better overall financial returns.

D. "I'm ready to retire from owning my business".

This is the king of reasons to sell. Just make sure its true. Selling a business often means walking away from it completely. Retiring sellers often want to think that they will be invited guests indefinitely.

Usually once the nuances of the business are understood the new owner will want to take the reins and run the business his way. At settlement you will sign an enforceable non-compete that legally and ethically obligates you to leave your old client base behind.

Another frequent issue is that the retiring owner has run the business "just to meet my needs" the last several years. In those instances the lower performance is what the business sale price is going to be based on. If you as a retiring owner want the full price based on what the business could really do - generate those results yourself and sell the business when the numbers are strong.

In general buyers are the least suspicious about dealing with retiring sellers. If the retiring owner has run the business well up to the end they can often get a small premium on their price.

The Bottom Line

There are thousands of variants to these four reasons to sell your business. Each variation comes down to the same underlying thought process-are you selling because of short term issues you will overcome or are you selling because it is time for you to get out? No one can answer this question for you but your future success and happiness may depend upon getting you it right.

If business is slow in your industry but you are hanging on, and you like the business as much as another career, then don't sell. Get the marketing, accounting, coaching or other help to get out of your rut and make it to the good times.

If you are completely burnt out, it really is time to retire, or you have much better things on the horizon then sell the business while it is still performing well in order to maximize your sales price.

Gregory R. Caruso is an expert at helping business owners plan and execute the sale of their businesses. Greg is an inactive CPA, attorney, and business owner with 20 years experience. He can be reached at www.successfulexits.com.

Work at Home, Mom!
Bach Flower Essences
Alzheimer Disease Advice
Bach Flower Essences Shop (German)
Where to buy Original Bach Flower Remedies
Bachblüten Doc Nature
How to use Bach Flowers
J-5 WebKatalog - Web Catalogue
Living after Divorce

MORE ARTICLES:

Write A Book To Stand Out In A Crowd N Sell, P1
Have you ever felt your message was insignificant in an over-crowded market place? A client of mine said, "I'll probably never write a book because there are already too many books on every subject I can think of."

Top 5 Low Cost Ways To Get More Sales Leads And Sell More Without Cold Calling
Cold calling may now be outdated. People have become defensive to cold calls and not many respond to them anymore.

MarketingTactics Helps Randy Kerns Sell Latest Book
New website for "Information Archiving" created in one day MarketingTactics, an innovative web design firm announces the latest website for author Randy Kerns: www.InformationArchiving.com to support his book: Information Archiving - Economics and Compliance. "Their quick response got my new website up within 12 hours of my call."

Houses with Hardwood Floors Sell Faster and at Greater Prices than Those Without
Having wood flooring installed is a remodeling project that can increase the value of your home and help it to sell more quickly. However, choosing the right wood flooring requires research and expert advice. RenovatorsPlace.com, an online home improvement resource, offers multiple articles for homeowners with tips on how to select and care for hardwood flooring.

Do You Know Anyone Who Buys For The Reasons Companies Sell?
On our Saturday call, the question was:

How do I Sell Advertising on my Blog or Forum - Tips and Advice For Generating Revenue
If you are making revenues (or trying to) from monetizing your forum or blog through advertising, the question you may have is how should you do it That is, should you use advertising networks, Google AdSense, or sell directly and keep all the profits for yourself

How to Place Ads to Attract Your Local Customers
Want to draw in more customers and bring in more business? It?s an exciting prospect. You?ll need to attract customers through ad placement, but don?t worry. You don?t need to call your local newspaper editor and figure out who you should talk to at your local radio station. Forget that! Spend your marketing dollars wisely. Let those dollars work for you! Spend them in a place where clients will be attracted to your business; the Internet.

OPD Solutions to sell IBM Enterprise Supply Chain Planning Suite
OPD Solutions, a leading international consulting group specializing in supply chain management, announced today that it will be IBM's worldwide sales agent for its integrated supply chain software solution.

What Is Home Staging And How Does It Help To Sell My House
Home staging is the concept of preparing a house for sale. This can involve everything from removing clutter, re-arranging furniture and in some cases re-decoration, ensuring that the house creates a great first impression and helps buyer's to feel that they could really live there.

10 Ways To Get Your Ads Or Messages Noticed
Do you post to message boards, e-mail discussion lists, classified ads sites, FFA sites or newsgroups? People will usually read the subject line before they read your ad or message, so it's important they get noticed. Below are ten simple, but powerful tips to get your ads or messages noticed.

Phoenix Area Commercial Properties to Sell at Internet Only Auction
Higgenbotham Auctioneers International will conduct an internet only commercial property inventory reduction auction offering two prime parcels in the greater Phoenix area at 11a.m. (MST) on Wednesday, April 16, according to Jim Owen, broker and auctioneer, with Higgenbotham Auctioneers International.

Need To Sell Your House Fast? Breathe A Little Easier
SellHouseAmerica.com is offering a brand new service that connects home sellers to professional home buyers throughout the United States. Home sellers provide SHA with some basic information about the house or property they need to sell and it is instantly made available to a buyer looking for real estate in that area.

Classified Ads Can Make Affiliate Sales Fast
Using classified ads for driving affiliate sales is often discouraged because it is harder than other advertising methods.. But it is possible to make your affiliate sales grow through careful employment of classified ads.

Using Network Marketing To Sell Your Product
Network marketing is a concept that has been around for a while, and is a proven method of earning money. Network marketing, like any other business, is not a get rich quick scheme.