07 Sep Around the Web: A Week in Summary
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A recent article from Philadelphia Business Journal entitled “How to make your business sale-ready” offers steps business owners can take to prepare their business for an eventual sale. Planning ahead can help foster a successful and profitable sale.
Consider the following steps:
- Make sure you have accurate financial reporting
- Build a management team that can run the business without the owner
- Determine how much the business is worth by getting a business valuation
- Enlist the services of a tax professional
A recent article from Forbes entitled “The 5 Keys To A Successful Business Purchase” explores buying a business and what entrepreneurs who are considering a purchase should know. Buying a business can be a great way to reduce risk, but it’s still very important to be aware of success factors when looking to buy.
Before buying a business, a buyer should put a strong focus on the following factors:
- Find an industry that aligns with your goals and interests
- Conduct thorough due diligence with a team of advisors to evaluate the business
- When making an offer, be open to compromise and negotiate towards a deal where everyone walks away satisfied
- Be realistic about what you can afford and how much the business will make
- Make a plan for retaining key employees
A recent article from Smart Business entitled “How to get your business ready to sell” discusses how business owners can prepare to sell so that both the business and the owner are truly ready. Buyers will likely be very thorough in their due diligence as they evaluate the business, so it’s critical to be prepared.
Buyers will assess the value of the business based on several factors such as the management team, growth strategies, scalability, cash flow, and customer relationships.
Sellers can increase the value of the business before putting it on the market by utilizing outside professionals to help identify any gaps that need to be fixed such as a hole in the management team or high customer concentration. It’s also important to sell when the market is strong.
Owners should also prepare by working with a financial advisor to determine their own post-sale financial needs and plans, as well as addressing any potential family issues.