You’re finally, at long last, ready to sell your business. It’s probably been a long strange trip getting here, and you may feel immense relief having finally made this decision. But you can’t just jump into the business-for-sale market without a care in the world. Without a well-crafted exit strategy, you could make costly mistakes that affect your long-term financial health.
These are the most important exit planning mistakes to avoid as you work toward selling your Boston business.
Not Understanding Your Business’s Value
Your emotional connection to your business can blind you to its actual value. Buyers will not look at your company through the same rose-tinted glasses. Instead, they’re going to be skeptical of every claim, and continuously wonder what’s in it for them. Here are the most common value drivers. Identify which is most important to your company, and highlight it early:
Not Making the Transfer Easy
Buyers do not want a sale to be a nightmare. So if you can take steps to hand the business over easily, your business will immediately be more attractive. The following strategies can make the transfer easier:
Not Knowing Why You’re Selling
Many owners simply hit a point where they want to sell, without really considering why they feel motivated to do so. Don’t let money cloud your decisions. You need to know why you’re selling, as well as what factors will make the sale work for your and your long-term goals.
Lack of Preparedness
Preparedness is everything when you put your company on the market. It gives you time to identify key value drivers, assess the potential value of your business, set reasonable expectations, and address any serious weaknesses in how you run your business. The more time you have to prepare—and the more help you have in doing so—the more likely you are to enjoy a successful and profitable sale.
Not Keeping Your Options Open
When word gets out that your company is on the market, you may get an immediate offer. But don’t let your desire for a quick sale thwart your need for a sale that works for the long-term future of your company and your finances. The most effective sale is one that induces a competitive bidding process. Not all offers are in your best interest; work with an advisory team who can help you understand the specific impact of each offer, then choose the best of the bunch.