You’ve successfully operated and built your business into a thriving enterprise—congratulations! But now it’s time to move on, whether for a new challenge or to relax and enjoy the rewards of your hard work. Regardless of your reasons, you’re prepared to sell your business. Many small business owners, however, often confuse their operational knowledge with the insights needed for selling a company, which is a distinct process.
Here are six common mistakes to avoid when selling your Florida business:
1. Lack of preparation
Proper planning is crucial for the success of the sell of the business. Selling a small business can take a year or more, but effective planning can streamline the process to just a few months. To ensure a smooth transaction when the time arrives, keep your records up to date, maintain a detailed business history, and prepare a solid sales portfolio. Make sure your staff is well-trained and take care of any necessary preparatory work before listing or selling, such as reviewing expenses, organizing financial records, settling any outstanding legal issues, and addressing any structural repairs.
2. Overpricing or underpricing the business
It’s essential to set a realistic market value for your business. Overpricing may lead to a longer selling period, as potential buyers will be deterred by inflated prices. On the other hand, underpricing could mean losing money on what your business is truly worth. To determine the optimal price, have an experienced professional conduct a thorough valulation of your company. They’ll take into account factors such as current market trends, industry comparisons, and financial records.
3. Being unavailable and disengaged during the selling process
Although the right broker can offer valuable guidance and help attract potential buyers, you’ll still need to put in some effort when it comes to selling. No one understands your business better than you, and most buyers seek the assurance that they won’t be left hanging right after the deal is closed.
4. Failing to recognize the ideal prospective buyers
Avoid spending time on unsuitable buyers. If a prospective buyer isn’t pre-qualified or appears unready to make an offer, it’s best to move on. Think about the ideal candidate to purchase and manage your business, and make a decision that benefits the long-term future.
5. Lack of confidentiality
If news spreads that you’re selling your business, it might negatively impact sales in the meantime, which can ultimately lower its overall value. It’s important to take precautions and keep your decision as private as possible to avoid losing vendors and customers. An experienced broker can help ensure confidentiality is maintained.
6. Failing to seek assistance from experienced professionals
While a DIY approach can work for some home projects, selling a business is a completely different challenge. You may excel in your profession, but you likely aren’t an expert in business sales. It’s a complex process, so it’s important to seek reliable business and legal advice from trusted professionals. Finding the right business broker or consultant can be a key factor in your success, as they specialize in the buying and selling of businesses. A broker will guide you through every stage, from initiating the sale to finalizing the deal, handling tasks like listing, marketing, and identifying potential buyers. Plus, hiring a broker doesn’t mean extra expenses; on the contrary, they’re there to help you secure the best price for your business.
Don’t make these same selling mistakes — contact the Tampa Business Broker, Dave DeCamella, today to learn more and receive a free and confidential business valuation.