Tips on selling your business and what mistakes you should avoid
Decided to sell the business in Bedford that you’ve owned for years? Well then, there’s a lot you have to consider before you make such a decision.
There are many different reasons why people decide to sell the business in Bedford and sometimes, they even agree to a price which is far below the actual market value of their business.
Some people sell their businesses because they have reached their retirement age and want to reap the benefits of all the hard work they have put over the years. Others have found a more lucrative business and decide to diversify into a completely new field and in order to fund their new project, they have to sell the business in Bedford that they currently have ownership of.
How profitably you sell the business in Bedford depends largely on the steps you take while selling the business though. It is also imperative that you take all the measures necessary to sell your business at a price that suits you. So take everything into perspective before you decide to sell the business in Bedford that you currently own.
5 Steps to sell your business at the best price
Once you have decided to sell the business in Bedford, these are the steps that you should take:
1) Organize your documents
A very important step that has to be taken before you sell your business is organizing all of your records. You will not only need this to gauge the correct price to ask for your business, but also, many potential customers will request for complete documentation in order to evaluate the market price of your business. Getting organized will also help in evaluating your business growth and future profit forecasts.
In order to sell your business, you will also have to provide your potential customer with a complete report that will encompass every aspect of your business such as employee contracts, vender and sales contracts. You will also have to provide a report on how the business operates on a daily basis such as opening hours and other details.
2) Determine which industry your business falls in
There are multiple evaluation methods out there that you can use to set a price for business. Most people tend to use evaluation methods that do not apply to their current business industry and end up selling the business for far less than it is worth. Make sure you find out the appropriate sector that your business falls into. It is recommended that you use each of these methods to get a better idea about the selling price of your business.
3) Conduct research
In order to prepare yourself, conduct thorough research before you sell your business. This will help give you an idea about the process, requirements and different evaluation methods. Make sure you specify your research and find out different prices of businesses in Bedford that are similar to your industry. The research will help you find the appropriate market price as well.
4) Analyze the profitability of your business
Get all of your books in order and make a list of all your fixed and current assets. This will include inventory and the debts owed to the business by customers. You will also have to take into account every liability the business owes. Also create a forecast of expected profits and customer trends which can have a major impact on your selling price.
5) Hire a professional
Getting the right price estimate is often difficult as it involves evaluating a lot of information with the right method. Hiring a professional is a way to simplify the process for you and they might even market your business to their clients with ease.
5 Mistakes you should avoid when you sell the business in Bedford
Even if you follow the steps given above, there is still a chance that you will not get the price you deserve. Here’s a list of mistakes that you should avoid at all costs:
1) Insufficient research and planning
This is a common mistake people make. They do not conduct thorough research about their business and its potential selling price. Also, when organizing the documents, they neglect crucial information that can change the selling price of the business completely. To avoid this mistake, make sure you do not carry out vague research and each document is taken into account.
2) Hiring an incompetent professional
Often people tend to hire the wrong people to represent their business and settle for a price they think is appropriate but is far less than the true market value. Make sure you check the experience of the professional and do not settle for the first broker that you come across. Carefully consider a host of brokers and see what they have to say before you hire them. This will help cut costs and might even save you time.
3) Not marketing their business
This is also a huge mistake people tend to make. If you do not market your business effectively, you will end up with less potential customers. Due to the lack of customers, you might settle for a price below the market average. Talk to people about your decision to sell the business in Bedford and post ads online or in newspapers to effectively market your business.
4) Setting an inappropriate selling price
People often evaluate their business in different ways and sometimes, end up asking for far too much or less than the market price. Make sure you have estimated the correct price that encompasses all factors that associate with your business.
5) Do not rush the process when selling
It generally takes time for you to get the right price for your business, so sit tight and consider different customers before sell the business in Bedford. This will help you get the most appropriate selling price.
Finally, make sure that before you sell the business in Bedford, you follow the steps given above and avoid the common mistakes to end up with the best deal.
Sources
https://www.entrepreneur.com/article/40302
https://www.thebalance.com/selling-your-small-business-mistakes-2890127