So you’ve decided to sell your business. Congratulations! It is an exciting time, but you may have no idea where to start. Don’t worry. I’m here to help you Sell Well™.
Where do you start?
First and foremost, you need to decide whether you want to go it alone or hire a professional. While theoretically it’s possible for you to sell your business by yourself, there are likely one or more complications. You know your business better than anyone, but you probably don’t have much experience selling businesses. And running your own business is hard work, so you probably don’t have enough time. Finally, you are likely passionate about your business, which means you may have trouble staying objective about the sale – for example, determining what your business is worth. Hiring a professional can help solve these issues and improve your sales process, as long as you hire the right professional.
Who is the right professional for selling a business?
While most owners intuitively understand the need for experts, most don’t know whom to approach to help them sell their businesses. Many owners start with lawyers, accountants, or real estate agents. When your circuit breaker constantly trips, you call an electrician. When your pipe bursts, you call a plumber. When your alternator dies, you take your car to an automotive service center. Selling a business is no different. To do it well requires a specific skill set and extensive relevant experience which an experienced and talented business broker can bring to the table. While your other professional advisers will be integral to the sale process at some point, hiring a competent business broker is essential to evaluating, marketing and selling your business.
Why is it a good idea to hire a business broker?
A talented business broker can add tremendous value to the process. Let’s look at some contributions a great broker can make. When you advertise your business for sale, it’s very hard to keep it confidential. Even rumors of a sale can potentially hurt your business, even if no one knows all of the details or timing. An experienced business broker will market your business in a confidential matter, making sure that the continuity of your business is not at risk and that you can continue operating your business in the normal course.
Valuation is always a difficult subject for any business owner. Valuing businesses is a complex exercise which should account for external factors such as the overall economy, the relevant local economy, the market in which the business operates, and internal factors such as the profitability of the business, opportunities for further growth, duration and quality of operating history, and performance trends. Getting valuation right is one of the most important tasks in a sale process. While it is important to get the maximum possible value for the owner, it is equally important not to overprice the business. Every day I see advertisements for businesses that are significantly overpriced, and they all have one thing in common. They stay listed, rather than being sold. A professional business broker sells businesses for a living. We know how to present a company to achieve the best possible sales price. We know what features are key to advertise and what kinds of buyers to target. The analogy that I often provide to my clients is that when you’re in the market for a used car, a clean, shiny car has more of a chance to be sold than a dirty, beaten looking car, even if the cars are otherwise the same. Marketing is important!
Finally, it is important to remember that the selling process involves much more than just identifying a buyer. It is a complex, multi-step process during which things can go wrong at any moment. A talented business broker guide you through each step, holding things together and ensuring a smooth process.
Comer Business Brokers is a full-service business brokerage firm located in Fairfield County and serving the entire state of Connecticut and Westchester county, NY. Owner and founder Irina Comer has more than a decade of experience with mergers and acquisitions of all types. She spent ten years at PricewaterhouseCoopers advising local, national and international companies on transactional issues, including valuation, diligence, structuring and positioning. After obtaining her MBA from New York University’s Stern School of Business, Irina worked in the Mergers and Acquisitions division of Bank of America Merrill Lynch. Comer Business Brokers can help you to structure a deal that makes sense and close efficiently and with confidence, all while maintaining the strictest confidentiality of your personal and commercial information. We hope that this adds to your understanding of the process, and we look forward to hearing from you when you decide to take the plunge. Best of luck!