If you are thinking of selling your business, there are many different things to consider as you go through the process. It’s important that you are happy with the sale of your business, as well as the buyer being happy with their purchase.
Selling your business for the first time can be a daunting process, and it’s important not to miss anything as you go through each stage. It is easy to make a mistake or to make the wrong decision that can affect the sale of your business.
With that in mind, we take a look at some of the common mistakes you should aim to avoid when selling your business.
Poor Negotiating Skills
When selling your business, it’s important to have good negotiating skills to get the most out of the sale. After all, you should benefit as well as the buyer. When negotiating the sale, you should be as honest and transparent as you can to facilitate a straightforward sale.
Regarding things like why you’re selling the business and the successes of the business over the years, it’s in your best interest to be honest. The buyer will probably find out the truth in the end anyway, and it’s better coming straight from you.
Furthermore, you should ensure your financial figures are readily available for the buyer. This is one of the most important parts of the sale, and not having clear figures can hinder your sale.
When it comes to negotiating skills, you should also ensure you are advertising your business in its best light! Make sure you understand your business’ key selling points and what makes it an interesting prospect and utilise that when engaging with buyers.
Many business sellers can be defensive about selling, with many acting protective over their business and not wanting to sell unless it’s the perfect buyer. Some business owners can even be quite bitter about selling, hindering the process and putting buyers off.
If selling your business wasn’t necessarily your chosen path, and you’ve instead been forced due to circumstances, try to see the positives. Selling your business gives you the chance to start again and perhaps even try your hand at something you’ve always wanted to do.
Aiming Too Low or Too High
The selling price for your business is so important and is usually calculated based on several factors. It’s crucial to get this right so that you don’t sell yourself short, or go too high and struggle to sell. If you sell at a low price for your industry, you might be kicking yourself afterwards that you could have come out of the sale better off!
Do your research and ensure you come to an agreeable and realistic selling price, or you will find the process to be much more difficult than it needs to be. Knowing the value of your business can be a big help; our business valuation calculator can help.