01 Jun Around the Web: A Week in Summary
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A recent article from Inc. entitled “How to Sell Your Business and Actually Make a Profit” discusses the importance of proper planning for the sale of your business and how to go about doing it. 80% of businesses for sale will never sell. To be in the 20% that will sell, having a thorough process is critical.
The GPS Exit Model is intended to produce a profitable sale. This entails knowing where you are today (current business value) and knowing what your sale destination is (desired sale price). Then you can develop a roadmap to get there with checkpoints along the way.
Important considerations include when you want to sell, who your buyers are, how much your numbers need to grow to reach your desired sale price, what buyers are willing to pay for, and why you want to sell for that desired sale price.
A recent article from BenefitsPRO entitled “Selling your business: Navigating M&As in the employee benefits market” discusses selling a business in the employee benefits and insurance space. While 2021 saw a flurry of M&A activity, 2022 is experiencing lower supply than demand which means there is a great opportunity for those willing to sell.
Tips for sellers include:
- Do your homework
- Have conversations as early in the process as possible
- Clean up your financials
- Find the right fit
- Expect some stress
- Be aware your ego may take a hit
- If they promise you something, make sure it’s in the agreement
- Remember small businesses have value too
- Find someone who’s been through the process
A recent article from Inc. entitled “Remember These 5 Tips Before You Sell Your Company” offers advice for business owners who are seeking a sale of their company. It is important to make your business appealing to buyers and maximize your chances of a successful sale.
Consider the following tips:
- Show buyers why the business is valuable
- Be prepared to present complete financials, the good and the bad
- Build a diverse customer base
- Streamline, automate and delegate to reduce the time you spend running the business
- Demonstrate resilience through tough times such as the current economic challenges