Preparing Your Business for Sale? You Better Follow these Rules

The best way to generate the highest possible value for your business is to prepare for a sale long before the fact. BizJournal recently published “Top 5 rules on preparing your company for sale”, which encourages business owners to begin to plan for their sale beginning now. The article focuses on the following ‘rules’: 

pexels-photo-279008

  1. Consider auditing your financial statements now – buyers will require reviewed financial statements at a minimum.

  2. Keep appropriate, complete corporate books and records so everything is ready to be presented to a buyer when the time comes.

  3. Obtain a professional valuation of your company so you can use this as a roadmap for growing your company and ultimately maximizing the exit price.

  4. Use the valuation of your company to determine where the true value of your business lies. This can also help you formulate a strategic business plan for the immediately future.

  5. Identify a second in command who could easily replace the founder of the company. This mitigates perceived risk in the eyes of a buyer, given a strategy exists to maintain customers, suppliers and employees.

Buyers tend to put their best foot forward when they sense a company is well prepared for sale. They are less concerned about whether the numbers will hold up through diligence and as a result the company receives the strongest possible valuation.

Read the full article here