One of the major reasons why you start and build a business is to be able to sell it at some time in the future for a profit.
So… What are the factors that will maximise your selling price?
It’s really important to understand this early so that you can put in place the necessary systems to ensure that you build a business that is sale-able.
I have these discussions with clients all the time. Despite the goal to maximise a potential sale price in the future, I always advise client’s to assume that they get nothing for their business when they want to get out. This way we ensure that wealth building strategies are put in place along the journey, harvesting the profits and cash flow to build assets outside the business. This is really important due to the fact that there could be a major economic downturn or some other event at the time you wish to sell – the result, there may not be a market to sell to or a severely depressed market resulting in a substantially reduced selling price.
With this in mind, here are my tips:
Of course, this list is not exhaustive. All I aim to do is make you aware of some of the factors that will influence the value of your business. Keep these in mind as you start or build your business.