Have you ever thought about selling your business? A lot of entrepreneurs say, I’m not going to sell my business, but it’s something that I invite you to think about right now.
Why? Because many business owners find themselves needing to sell their business fast. Unexpected events happen and we find ourselves needing to move or needing to give up work. In fact most business sales are triggered by such an event. So how can you be ensure you are ready?
Selling your business is just like selling a house. The principles are the same. You must be prepared. You have to have “home opens” and you need to look amazing on that day.
There are three things that are going to make your business look good to a prospective buyer. Let me share.
The first and most obvious thing is profits. Your business has to have a history of healthy profits. This is the first thing a prospective buyer will look at.
What can you do to make your business more profitable?
The second thing that you want to think about is the systems you have in place. Your prospective buyer is going to be evaluating how successful your business will be without you.
Do you have the systems in place to ensure that there’s continuity without you? Your systems influence that business valuation. The more systems you have in place, the better.
It’s important to have those systems documented. And in particular you need systems for the money-making activities of the business. e.g. how you deliver your product and service to your customers. These systems must ensure that your customers get a consistent experience every time.
Do you need to invest some time in developing your systems?
Positive Cash Flow
The third thing is cash-flow. A business has either positive or negative cash-flow. A positive cash-flow enables a business to grow without having to inject more capital. On the flip side, a negative cash-flow business requires fund injections to grow. A positive cash-flow business is more attractive to a buyer
So how can you speed up the cash-flow in your business? Can you get the customers to pay sooner? Where can you get credit in your business? How can you make your business more cash-flow attractive?
So if you want to turn your business into a saleable asset, the 3 things you must focus on are profits, systems, and cash-flow. Do this and when you need to sell your business you will get rewarded for all your hard work. and you deserve to be rewarded.
You can do it!
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