You might be asking yourself a question if you’ve been hearing a lot of “buyers are scarce, prices are low”. Should you take the advice of an outside advisor who tells you that now is not the right time to sell because in two years or so things may change? Will there be more buyers and a higher price tag? Perhaps. But think about this: is your business thriving now? If so, maybe you should hold onto it for a few more years. After all, when an advisor tells the owner that if he keeps it for three more years the price will double. That’s a terrific incentive to keep plugging away. If your business is doing well, hang onto it for a little while longer. The right buyer may come along at the right time.
There are several factors to consider when deciding to sell. It’s not always an easy one to make. However, if you find yourself in a situation where the costs of continuing to operate your business have increased dramatically, and you’ve lost interest in the company, it might be time to sell.
Other factors to consider include whether your equipment needs upgrading or replacement, whether your products or services are aging and need revitalizing, and whether you need additional capital to keep the company up-to-date and competitive. If your leases are expiring and you have long obligations required to renew them, this could also be a sign that it’s time to sell. Ultimately, if you’re no longer enjoying running your business, it might be time to consider finding a new owner.
All of us can relate to the feeling that it is time to slow down and enjoy life. That’s why we sell our homes, trade-in our cars, or retire from a job we love. And yet some people feel they should be doing something more with their lives even though they have enough money for retirement and no health concerns. For them, it’s not about the money; it’s about feeling like they’re missing out on something.
The point comes when the business or its industry is peaking, and everyone wants “in”. That will be the time to sell. There is an old story that the time to sell the buggy whip business was just before Ford started producing the Model-T. As they say, “timing is everything.”
Many factors come into play, like whether the industry you are in is on the upswing and if there are solid buyers interested in purchasing your company. But one thing to consider is if you are at the top of your game. If sales are robust and growing, your balance sheet is clean, and your employees are productive and happy, then it might be the right time to sell.
On the other hand, if there is a manager within the company who is ready to take over in a buy-out of some form, that could also be a good time to sell. It’s a personal decision and one that you should carefully consider with your financial advisor. But if you are running a well-oiled machine, then selling might be the best option for you.
The right time to sell your business is when you decide it might be time. No one can tell the owner when it is the time to sell. Outside advisors are well intended, but no one knows when it is time except the owner. And, when it’s time – it’s time!