Aug 14, 2018 Developing an Exit Strategy to Sell Your Business for the Most Money
I meet with a fair number of small business owners that are starting to consider selling their business sometime in the future. Naturally, they want to get the most money they can when they sell to have the best retirement possible and to take care of their family.
The first question is – How much is my business worth? There are several methods but mostly, a buyer will value your business based on how much money it makes (net income) in the immediate past and how much it is likely to produce in the future.
So you need to have a high performing and profitable business. Obviously I help a lot of companies increase their bottom lines and have written a lot about this in this blog. Particularly, I use the Apollo Profit Acceleration Technique.
So beyond increasing profitability, what else do you need to do? The business needs to be able to run without you. This means that all the things you do need to be able to be done by someone else. These tasks need to be accomplished in order to produce the same end product, with the same quality and at a cost that is the same or lower than it is now.
To do this, authority needs to be delegated, jobs formalized, processes written down, financial records accurate and transparent, etc. You might even have to shift some of your staff around or hire someone with some of the missing skills.
It is basically simple – have a company that is very profitable and can run without you. Getting there will take a plan and some time to execute before you want to sell the company.
It goes without saying, if you need some help with these things, please reach out to me.
Bryan B Mason
Apollo Consulting Group, Providence, RI