Determining the Right Time to Sell
Determining the Right Time to Sell Your Business
Determining the right time to sell your business can be a challenging decision. If you’re considering selling, one of the best steps you can take is to contact a business broker. A seasoned business broker will have years, or even decades, of proven experience and can guide you through the process of preparing your business for sale.
Why Contact a Business Broker Early?
One major reason to contact a business broker well before you think you might want to sell is the unpredictability of the market. Market forces can change, unexpected events like a large competitor entering your area can occur, and various other factors could lead you to conclude that now, not later, is the time to sell.
Key Factors in Determining the Right Time to Sell
In a recent article by The Tokenist titled “When is the Best Time to Sell a Business?“, author Tim Fries outlines several factors to consider when determining the best time to sell. At the top of Fries’ list is growth. Demonstrating a consistent history of growth is crucial, as buyers look for this key component. Growth will help you justify your asking price when you place your business on the market.If your business is experiencing significant growth, it could be a strong indicator that now is the time to sell. Pamela Wasley, CEO of Cerius Executives, states, “When your business has grown substantially, it might be time to consider selling it. Running a business is risky, and the bigger you get, the bigger the risks you have to face.” Growth is central to determining whether or not you should sell.
Understanding Market Conditions
Knowing the “lay of the land” is essential. For example, have similar businesses to yours been sold or acquired recently? If the answer is “yes,” this is a good indicator of substantial interest in your type of business. Reviewing recent sales of comparable businesses can help you determine how much buyers are willing to pay, allowing you to spot potential trends.As Fries points out, various market factors such as relatively low taxes, low interest rates, a strong overall economy, and an upward trend in sales prices can all impact the optimal time for a sale.
Timing and Preparation
Now might not be the perfect time for you to sell, but getting your business ready for sale takes time and preparation. Fries emphasizes that smart sellers “look for a good time, not the perfect time” to sell a business. Working with a business broker can help you determine if now is the right time to sell and what steps you need to take to be prepared. For more insights on the emotional aspects of selling your business, visit our article on The Emotional Side of Selling Your Business. If you’re considering selling your business, learn more about the process at Selling a Business. By starting the preparation process early and staying informed about market conditions, you can make a well-timed decision to sell your business at the best possible price.
