Many buyers are taking advantage of the opportunity offered by today's distressed marketplace.
Many business owners are considering the sale of their business.
Here are some of the reasons why, followed by tips for getting the process started.
The Buyers Are Out There
The current economic downturn points
directly to reckless and ruthless investing. This is viewed merely as an opportunity
to some buyers for " killer deals".
Executives and middle managers
out of work--and determined not to be "downsized" by big business again--are
eyeing the advantages of being in business for themselves. Since
1990, the percentage has steadily grown of those corporate executives
who leave jobs in order to become independent business owners. It
isn't just the money they are dreaming of--it's the desire for
more control over their lives.
How to find these buyers? The business broker is
the professional to whom sellers turn when looking for serious,
"qualified" buyers. The business broker not only helps
match the right buyer with the right business, but also educates
the buyer in the buy-sell process, alleviating concerns and keeping
the transaction in steady forward motion. With plenty of buyers
to choose from in today's market, it's more important than ever
to identify the time-wasters and those who think they want to buy
but really aren't ready to take the big step.
It's Better To "Cash-Out"
Than To "Burnout."
Burnout can come with a business that's successful as well as one
that's failing to grow. The right time to sell is before the syndrome
becomes a threat to the effective management of a business. What
are the warning signs of burnout?
- The burnt-out owner has been shouldering the burdens
alone too long
and even routine acts of decision-making and action-taking seem like Sisyphean
- Burnt-out owners are so close to their work
that they lose perspective. Prioritizing becomes a major daily
challenge, and problem-solving sometimes goes no further than the business Bandaids
that cost money in the long run rather than increase profits
- No more fun. Of course owning a business is hard work, but it
should also include an element of enjoyment. The owner who drags
himself or herself through every day, with a sense of dread--or
boredom--should consider moving on to a fresh challenge elsewhere.
- Just plain tired. Simply put, many business owners burn out
from the demands placed on them to keep their companies operating
day after day, year after year. The schedule is not for everyone;
in fact, statistics show that it's hardly for anyone, long-term.
The important point here is for business owners to recognize the
signs and take action before burnout begins to hinder the growth--or
sheer survival--of the business. Many of today's independent business
owners feel they've worked hard, made their money and sense that
now is a good time to "cash-out" and move on.
The Best Price Comes from Selling While "Up."
Other than burnout and its consequences, there are other factors
that can lead to the "forced sale" of a business. Compelling
personal problems (a divorce or death in the family, poor health),
shortage of capital or outright failure of the business, the lack
of heirs to take over--these are the traditional examples. Instead
of waiting for unfavorable conditions, potential sellers should
keep a wary eye out for that all-important right time for putting
their business on the market. When might that time be?
The Small Business Administration (SBA), in researching
selling trends, reports that three to five years is a long enough
stretch for many of today's business owners.
One in every three
plans to sell; many of them right from the outset. The business
they've bought is not a legacy for their children--it's a shorter-term investment
of their time as well as their money.
The ability to present a healthy operation,
with an owner in the position to "role
model" its success are major advantages in the completion of
a successful business sale. One of the surest ways to maximize the
value of a business is not waiting too long to sell.