Making Your Small Business Attractive to Buyers
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Congratulations! You’ve built up your small business to a point where acquisition makes sense for buyers. But be clear — building a business and marketing that business for sale are two different animals. Let’s take a look at how to make sure your successful business looks successful to buyers.
Can Your Business Run Without You?
If you’re trying to sell your business, you are making the claim that it can run completely independent of you. Is this actually true? Many small business owners gallantly take on multiple hats to fill in the holes, but this doesn’t really fly if you’re getting ready to sell. Make sure that you set up systems that are 100% independent of your participation, even if you plan to stay on as an advisor.
Is Your Client Base Diversified?
You may start off with a few big clients paying all the bills, but your business should grow into a diverse client base. It’s much easier to provide large services to big clients who are paying top dollar. Buyers are looking for a sign of maturity — the ability for your small business to service smaller clients on possibly tighter profit margins. Servicing smaller clients also requires process standardization, which leads into the next point.
Are Your Processes Standardized?
More often than not, standardization means modernization and automation. Buyers love to see this, because you have minimized reliance on individual human aptitudes. McDonald’s is one of the most popular franchises around the world because of their processes, which can be duplicated regardless of the talent of the workforce.
Whenever you do need to rely on people, there should be a code of conduct and performance metrics in place. Job descriptions can no longer be hazy. Doing this while preserving your company culture makes your business incredibly attractive.
Can Your Business Scale Further?
Sophisticated buyers don’t buy business snapshots. They are looking for a business that can continue on an upward trajectory while maintaining a consistent revenue stream. Outreach technology is moving quite fast. Any business without online traction and/or distribution will quickly fall out of contention if it doesn’t get these things fast. Buyers understand this.
Make sure that you build your small business for the future, not the present. None of your processes should be so rigid that they cannot improve with the rise of new technology. As a matter of fact, your internal suggestion process should be one of the most straightforward and clear processes you have!
If you are getting ready to sell your business, the experts at Murphy Business may be able to help you. With decades of experience helping proprietors find profitable exits, Murphy Business has more than $3 billion in completed transactions. Get your initial consultation over the phone at (727) 725-7090 or through email on our website. We also have an information buffet of free downloads that are sure to help you sell your business.
Your business isn’t getting any younger, and neither are you! Call us when you are ready to sell.