When to sell your business
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Published by TOP4 Team
Every businessman has different reasons for selling a business, but there are better times and conditions than others in which to do so.
For instance, selling simply because you’re exhausted or can’t stand managing day-to-day operations anymore can drastically reduce the value of your company. But bailing out under other circumstances may prove profitable. Here are some signs that it may be a good time to sell.
You can’t fund the company’s growth anymore.
Some businesses grow faster than others, and yours may expand so quickly that you can no longer finance its growth. If you are unable to secure additional debt or equity financing, it may be time to sell your business to someone who can. Ensure that your business is professionally valued and that the valuation takes into account that rapid growth.
The business runs effectively when you’re not around
Many small-business owners develop their company to be completely dependent upon them. They are the face of the company to customers, as well as the CFO, marketing director, and receptionist. This type of business is difficult to sell because there’s no guarantee it can operate without its founder.
You have a more lucrative opportunity
New business opportunities can pop up at any time and you may suddenly go from forecasting the next 20 years for your existing business to wanting to buy a new one. If the profit projections are higher for the new company, you should consider selling your business and taking on the new one. Before making the leap, however, take some time to consider ways to integrate the two businesses and take advantage of any synergies. You could end up making them both more profitable.
Upcoming life changes will affect your business
If you are expecting substantial personal upheaval in the near future, it may be a good time to sell. For example, if you are having a baby, starting chemotherapy, or going through a complicated divorce, having the money available from the sale of your business may be helpful, and you will avoid the sometimes inevitable disruptions to the operations. However, if you’ve built your business to operate without you, this may not be a concern — and you may be better off keeping the steady income that your business brings in.
Consult Finn Business Sales Sydney today to know more about business selling.