Top tips if you are thinking of selling your business in 2019:
Company owners often finish up selling their businesses for a lot less than they could. Here are 12 things you must do to ensure you get much more.
1. Produce detailed plans for sustainable growth for the next 3-5 years with a clear explanation of exactly how you will achieve this.
2. Show how your product and service package delivers a clear competitive advantage which will provide a solid foundation for future growth.
3. If you are over-dependent on one or a few customers, demonstrate how you are successfully working to get a less risky balance.
4. Show a record of growth of sales and profits for the last 3 years, if you can, with a clear story of how you achieved it.
5. If you are highly dependent on one or a few key people, demonstrate how you will keep them loyal through and beyond a sale process.
6. If you are highly dependent on products and systems at the mature stage of their life cycle, or relying on ageing patents, demonstrate how your new product development activities will deliver dependable future revenues.
7. If the business is still highly dependent on you as owner-manager you need to demonstrate how you are passing over responsibilities and customer relationships to your team.
8. Show a consistent record of detailed and reliable management information and full financial reporting.
9. Show that you understand and have a plan to meet structural or legislative changes or long term trends affecting your industry.
10. Sell your business before you have to, when selling is optional.
11. Plan to sell when growth rate is at its fastest, not when it has peaked.
12. Getting top level advice and representation 2 years before you plan to sell will ensure that you get and keep the best possible deal value, the most tax-efficient and least stressful outcome.