Many of my business coaching clients eventually ask, “Should I consider selling my business?” There are many factors that should be considered when weighing such an important decision. And, I have noticed many times when it is the right time to sell, but the owner won’t take action. Here are some things I have observed in my business coaching that might be helpful to you if you are considering selling your business.
Business Coaching Tip #1: Many business owners won’t sell their business, even if it is the right time to do so, because they don’t have a clue what they would do without it. This means that their identity is so wrapped up in the business that they don’t have any idea of who they are without it. It happened to me. It happens to most business owners. This is why a balanced life is important. This is why it’s important to retain your own identity, separate from your business. If you become your business, you will never sell it!
Business Coaching Tip #2: Many business owners can’t sell their business, even if they want to, because it has no value without them. In order to sell a business, the business needs to have value even if the business owner is not in the picture. This is a consideration every business owner needs to take into consideration, even if they don’t intend to sell their business any time soon. Build a business that can breathe without you. It will give you options down the road that you will be glad you have.
Business Coaching Tip #3: Don’t stay too long at the fair. There is nothing sadder than hearing a business owner admit that they should have sold their business two or three years ago. Remember, all businesses go through a life cycle: birth, growth, maturity and decline. You usually want to sell just before you reach the end of the maturity cycle. Unfortunately, I sometimes get new clients in my business coaching practice that waited too long. It’s hard to rewind the clock after a business has reached the decline stage. Be very realistic about where your business is in the cycle.
Business Coaching Tip #4: Entertain all serious inquiries. Many times, one of my business coaching clients will tell me that someone called and said they are interested in buying their business. Often, they decline to talk to them, because they are not interested in selling at that time. Never decline to have a conversation. When someone approaches you, it’s a great time to find out more about your businesses market value. You don’t have to share any confidential information, just ask questions. It’s amazing what you can find out. And, I have seen business owners be surprised by how much they could actually get for their business and decide to sell it.
Business Coaching Tip #5: If you are entertaining an offer from someone to buy your business, be sure to shop it to other potential buyers. I cannot tell you how many times I see business owners ready to take the first offer they receive. That’s like marrying the first person you date. Find out who else is interested. See what others are willing to pay. The price almost always goes up when there are several interested buyers. And, you might find that the fit would be better, as well.
Business Coaching Tip #6: Hire someone to represent you. Don’t try to sell it yourself. These negotiations get sticky. They take a lot of time and energy. The buyers job is to tell you how ugly your baby is. Your job is to tell them how pretty your baby is. If you are the one at the table negotiating, it can get personal. You need to be running your business, not spending time selling it. Hire a professional. Someone who will work on a small retainer that will eventually come out of their percentage of the sale. Check references. Get someone who is really good. It can be some of the best money you will spend.
Business Coaching Tip #7: Don’t take your eye off the ball. This is a real danger zone. Business owners get so wrapped up in selling their business that they forget to run their business. Value can decline rapidly if you take your eye off the ball. Don’t.
Business Coaching Tip #8: Remember that these deals often fall through. Don’t get too attached to the outcome. Don’t see dollar signs and imagine yourself on that beach in Jamaica. The probability is that the deal will fall through. Don’t get excited until you have the money in the bank.
I hope this give you some good food for thought if you are considering selling your business.
Nan O’Connor, MCC
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