Getting a business valuation is usually the first step once you have decided to sell your business. But how can you determine the best time to sell?
The reason for the sale of your business
The decision will likely be made due to emotional circumstances, economic circumstances or a mixture of the two.
- Some small business owners will want to sell in order to maximise the sale value in an economic boom.
- Other SMB owners may be ‘burnt out’ having invested not just money but all their passion and time into their business. They either ‘want out’ of running their own business or are just ready to reignite their passion in a new business venture.
Impact of Seasonal variation
August consistently sees a reduction in buyer activity, so it’s a good month to prepare your business for sale, and see if you can add any value.
There has somewhat surprisingly always been a small surge in buyers looking for businesses for sale in and around Christmas.
However, overall there is not a ‘best’ seasonal time to get your business valued and put up for sale.
When interest rates are low and lending is easier to come by, there will naturally be more buyers in the market.
That doesn’t mean to say that it’s not good to sell when interest rates are high, as surprisingly many small businesses are sold to cash buyers.
Thinking about an exit
The reality is that once you have started to think about an exit, a new project or new business then you are at the point when you should get a valuation to move towards selling your business.
If you feel like a change, or the time is right for emotional or economic reasons get your business valued. This will give you the financial information you need to weigh up the pros and cons of selling your business.
Posted on September 07, 2018 | Time to Sell, Time to Get a Valuation