It is said that the time to develop an exit strategy is the day you open for business. That may be true, but it’s not very realistic or very optimistic. On the day you open your doors, thoughts about how to get out of your business aren’t pleasant or helpful thoughts and they can’t be ignored because they will take away from your focus on getting your business off the ground. However, as you get your business to a place where you have some extra time to plan, you will find that the things you need to do to improve and grow your business are also some of the same things you will need to work on to plan an exit strategy.

It’s tough to predict when the time will come to sell your business. But if you find yourself dreading the drive to work, maybe it’s time.   Here are some things to consider that will improve your business – and make it more sellable. Dealing with these areas will give you the information a buyer will be looking for when the time comes. 

Buyers want cash flow.

This, at least on the surface, is the thing a potential buyer will want to look at. What does this mean for you? It means that if your company has enough of a cash flow cushion so that it can pay its bills and expenses even when sales are slow, then you have some breathing room to work on an exit plan. Conversely, if your company is constantly on the brink of bankruptcy, then you will have a much harder time finding a buyer who is willing to take it on. 

Appearances are important.

Appearances are important for business owners. Just because everything looks okay on the surface, it doesn’t mean that everything is functional. Two letters not working on a neon sign can be an indicator to a possible buyer that the seller has lost interest in the business, and may cause them to wonder what else isn’t up to par. Make sure you are putting your best foot forward, because appearances do matter.

There is probably more value than you think.

Things like customer lists, secret recipes, specialized computer systems, and customer loyalty programs can create real value for your business. It’s important to explore all of your options and find ways to capitalize on the value that you already have. Don’t overlook the potential value of your business – there is probably more there than you realize!

Eliminate the surprises.

How do you eliminate the surprises? You see, minor problems and issues will often raise their ugly heads during sensitive times, spooking a possible buyer. So, the time to resolve them is before going to market.  Eliminate the surprises with your landlord by working out a transferable lease agreement or at least getting verbal permission from him/her to sell. Also, take care of outstanding business permits and licenses with the town hall. Finally, deal with any customer service issues that may still be hanging around. Putting these items to bed before marketing will help avoid any bumps in the road and keep your business running smoothly.

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