Getting the Best Price When Selling A Business
Helpful Tips For Getting the Best Price When Selling A Business
Selling a business is already a complicated process for most business owners and it can get even more complicated when the sale includes commercial real estate. It is both an economic and emotional decision and your level of preparedness can play a big part in the outcome of the transaction.
Business owners who seek to exit their business through a sale should begin with property valuation process as early as possible. This way, you will have enough time to put together a strategy to improve the business to a level required to achieve the desired exit goal.
There are many other key factors to consider to ensure that you have a better chance of getting the highest offers on all your assets. Let’s take a look at the following steps you should consider before starting the process:
✓ First Impression Lasts
When preparing to sell a business, especially one that includes commercial real estate, first impression is everything. Take the time to boost the curb appeal of your business. You might need to upgrade your facilities, complete repairs, and improve the overall condition of your property before presenting it to your prospective buyers. Even small things like cleaning and landscaping can make a huge difference. While you might not want to spend a significant amount of money for improvements in a business you are leaving, it will pay off in the form of more buyer candidates, shorter lead times and better offers. Prospective buyers are less likely to make an offer if they can’t see themselves in your business environment.
✓ Prepare Legal Documents and Financials
Let your authorized real estate agent know about your plan to sell your business so that they can research the actual market value of your property and recommend the best price. It also helps to find a good lawyer or accountant to study the legal and financial data, as well as gather all assets that need to be presented to the potential buyer. The tasks may be more laborious if the record-keeping is outdated. Having clean records will ensure a buyer’s trust and can increase the value of the property or business that you are selling.
Make sure that your documents have undergone the due diligence process when the buyer asks for it. Potential buyers may want to dig in-depth into the records of the company, and clean files can be the deciding factor in the sale. Create and rely on professional advisers that may be composed of a lawyer for your legal records and an excellent real estate agency that can bring you, potential buyers. Give enough time to talk to them and settle the details before you meet the buyer. List down the possible questions your buyer may have so that they will not have any reason to delay or decline the transaction.
✓ Hire a Professional Real Estate Agency
Selling your business at a price that you will be satisfied with is not as easy as it seems. The toughest part of the process is finding the right buyer, especially when you’re just not getting any decent offers. The best solution for this is hiring a real estate professional to help you with property valuation and marketing.
On the other hand, if you’re confident that you can complete the sale without hiring a professional, having an aggressive marketing strategy is the key. Post your property listing on business for sale and other property websites so you can reach potential buyers who are searching for businesses and properties to buy. You can also reach out to your network of family, friends and acquaintances who might know of interested buyers.
If maintaining confidentiality of your potential commercial property sale is important to you, then a professional agency may be your best option to successfully while keeping the sale under wraps. Here at IPS, our real estate experts have all the tools and the right venue to match sellers with potential buyers. We provide our clients unbiased selling strategy that is customized to your needs and make sure your business appears attractive both physically and financially.
✓ Set a Reasonable Selling Price
Of course, you want to sell your business with the highest margin of profit as possible. That is fine if you are willing to wait for the buyer that will agree to your price. It takes approximately 6-10 months to sell a business. If you want to sell your business as fast as possible, consider lowering down your rate. However, this can cause you to lose part of your investment cost marginally. The key here is to balance your initial investment versus your current needs.
✓ Market Your Property
Marketing is highly essential in attracting potential buyers. You will not be able to sell your property at a reasonable price if you lack buyers. To attract as many potential buyers as you can, you need to consider several things:
Videos and pictures attract more potential buyers than a product description showing off all the qualities of your property. When planning to purchase a property or a business, buyers tend to research online. A well-presented property gets twice as many inquiries compared to properties with average or less attractive photos. Take advantage of the popular social networking websites such as Facebook Marketplace, Instagram, among others, where you can showcase your property photos and videos.
Additionally, if you decide to work with professionals, the scope of expertise of the real estate agency that is handling the sale of your property can also make a difference. Check references and reviews to make sure that they are accomplished in selling businesses and properties in the area.
Getting the Best Price for your Business
Other than setting up an excellent team of professionals and keeping your records clean, you also have to market it offline and online. Your choice of lawyer, accountant, and a real estate agency will ensure a smooth sale and fast turnover. Selling a business combined with a commercial property is a long and complex process, but it is one that can end in a very good payoff when done correctly. Take the time to make sure everything is planned and organized before initiating the sale process so you can address potential buyer concerns and get you the best price on all of your assets.
If you follow the practices given above, then you can turn the page of your journey into a great new start.