22 May Around the Web: A Week in Summary
A recent blog post from Tennessee Valley Group entitled “Three Reasons Most Retiring Business Owners Cannot Sell Their Business, And What You Can Do About It Now” explains why most baby boomer businesses won’t sell as this generation reaches retirement age.
The current hype around the baby boomer generation reaching retirement age is just that, hype. While there are many retirement-ready entrepreneurs contacting business brokers to begin the process every day, there aren’t necessarily many retirement-ready businesses coming with them. The three main reasons why a business is not likely to sell are:
- Pricing too high
- Wanting to sell before fixing any flaws the business may have
- Poor marketing
The good news is that with some time, money and targeted work, all of these problems can be solved. Within a few years a business owner can raise the value of their business, fix its flaws and find a business broker or intermediary who will partake in an active marketing campaign.
A recent article from Radio.com entitled “How to Know If It’s Time to Sell Your Small Business” describes a series of questions an entrepreneur can ask themselves to help determine whether or not it’s the appropriate time to consider selling their business.
There are many scenarios in which the option to exit may present itself. If there are investors making a generous offer, then the decision to sell may be an easy one. However, if the lines are more blurred than that, these questions can help you make a clear decision:
- Am I still excited? – The success of a small business is largely driven by the passion of whoever is running it. If your passion has departed, then the results may soon depart as well. If your answer to this question is no, it may be time to move on.
- How is my longevity? – Consider your cost of operation, current business model and overall outlook for your company. Is the end in sight or are there days of growth and profit ahead?
- Do I have support? – If you’re going to continue running the business, you need to have a qualified, well-trained staff and the support from your family to invest the amount of time and energy into the business required to succeed.
- Is my business worth buying? – Possibly the most important question of all, you can’t sell your business if nobody would be willing to buy it.
A recent article from Axial entitled “How to Tap Into Deals in New Sectors” discusses the ways in which one company managed to make a successful acquisition in a different sector than the one in which they were experienced and well-known.
An air quality consulting firm was well experienced in making acquisitions within their own sector, having made more than 20 acquisitions within twelve years. Over the lifespan of the company, they had built a network within their sector and had no trouble finding deals. Because of their lack of knowledge, network and experience when it came to the toxicology sector, they ran into some roadblocks when they began looking to expand into it. Using Axial as a platform allowed them to find the right deal for them despite their challenges.