Small Business Owners sell their business for a variety of reasons. Proper preparation of an exit strategy can help to maximize the value of your business when the time comes to sell. Here are 10 strategies to help increase the market value of your business.
- Realistic Value – Having a current business value will help identify specific changes that need to be made, and then you can determine how they will impact the value of the business.
- Exit Strategy – Planning for the sale of your business is important. A well-planned exit strategy can put your business in the best salable condition.
- Gross Margin – Determine areas of the business where you can increase your gross margin. This will have a direct impact on the value of the business.
- Accounting Practices – Typically a business maintains its financial records in a manner to minimize the tax obligation of the business. Assess the bookkeeping policies to keep records in a manner to maximize the value of the business.
- Sales – Seek out opportunities to increase revenues for the business.
- Business Challenges – Identify obstacles the business faces and develop a plan to overcome them.
- Management – Minimize the owner’s importance to the success of the business by putting management positions in place. The business should be able to operate efficiently with the owner not playing an active role.
- Customer Base – Position the business to have a diversified customer base. It is important that no single customer represents greater than 5% of the revenues of the company.
- Business Plan – Have a 3-year business plan in place to prepare the new ownership for growth.
- Competitive Advantage – Develop a “niche” in your industry to set yourself apart from the competition.
Selling your business is a process. If you are planning to sell your business in the next 3 years, I would encourage meeting with a professional to help with an exit strategy. I welcome you to contact Central Florida Business Brokerage at [email protected] or call us at (407)261-9001.
