Selling a business can
be a stressful process. After building your business from the ground up and not
having experience selling a business, the process can be very difficult. There
are several common mistakes that happen to small business owners when selling
their business. Continue reading for these common mistakes so you will be able
to avoid them!
Over Valuing Your
Business
Having your business at
a higher value than it truly is worth, can delay the selling process and cause
confusion for potential buyers. As an owner, you have to consider the buyers
point of view. If you have a biased view of your business when thinking about
the value, you are likely to value it higher than it actually is. Value is
based on your business's income generation. You need to have your business listed
at a fair market value to attract sellers.
Not Paying Attention to
Day-to-Day Operations During Due Diligence
Once there is a letter
of intent from a buyer, we've seen owners begin to neglect their business's
operations. A buyer can easily back out until the deal is truly done. If your
business suffers prior to the official sale, the buyer may decide they no
longer want to purchase your business. Due diligence can be a long process but
staying on top of your business during this time so the transaction can be
finalized is crucial.
Not Vetting a Potential
Buyer
If you have a potential
buyer, you need to ensure that they are credible. While it is exciting to have
a buyer for your business, you need to know the buyer's background, ownership
capabilities, financial standing, and qualifications. You want to know at the
beginning that the buyer is a credible person instead of reaching the end of
the transaction process and having it fall through.
Poor Timing
It is difficult to
predict the perfect time to sell your business. There are two things to
consider when trying to decide whether it's a good time to sell your business; it
is better to sell when your business is growing and have you taken
enough time to put your company in a good position & develop a plan for
selling. Figuring out the best time to sell your business takes precise
planning.
Not Using a
Professional
Whether you have sold a
business before or not, you may benefit from having a professional assist you
through the process. Since you will be still managing the business, it is
important to have someone who will have the selling process at the front of
their mind. A professional will be able to give a fair market value to your
business, continue the due diligence process, vet potential buyers, and make
sure you are making a good decision on selling your business.
Selling your small
business does not have to be a stressful experience. By avoiding these common
mistakes, you can have a smooth selling process.
https://www.howtosellmybusiness.com/the-most-common-mistakes-sellers-often-make/
https://summitadvisory.com/top-five-mistakes-business-owners-make-selling-company/
https://cenkuslaw.com/7-mistakes-to-avoid-when-selling-your-business/