In Show 072 – 5 Things to do Before You Sell Your Business originally broadcast on Facebook Live on Monday 19 March 2018 we explore this interesting topic.
Today on Fast Fix Monday we wanted to detail the five things you need to do before you sell your business. Getting you business ready for a sale is a really big process. There are many facets to that process that are often overlooked. Here are the big five that are an absolute must.
- Increase your EBITDA
Earnings before interest, tax, depreciation and amortization is the accounting standard that determines your company’s value. Companies are often sold for a multiple of your EBITDA. Some of the ways to increase the value is by keeping your costs down or increasing your revenue.
- Hire some great managers
One of the things that is particularly attractive to buyers is the presence of a strong management team at the company. If the business is overly reliant on the founder you will get a much lower sale price. As the owner/operator you want to start removing yourself from the day to day operations of the company well before you sell.
- Pay for audits
Buyers are going to be very suspicious when presented with financial statement that have not been audited by a chartered accountant. They need to be correct so get those statements audited before you put the business up for sale.
- Document your process
Think like a franchiser. What does a new owner need to know after taking over you business? Document all of your daily processes. You want to be able to provide a document that anyone can open and use to run the business as well as you do.
- Get real
If you want to sell you business don’t do it half-assed. Be committed to the sale process and make sure you know what you have to do. If you don’t do that you will minimize your sale process and make things much more difficult.
More about this Show
We started Business Legal Lifecycle to create a simple way for you to understand complex legal terms. Most importantly we want to help you to develop a plan to take your business successfully into the future. There’s a startling statistic the underscores the importance of developing a solid plan. The majority of business owners are just seven months away from losing everything. A single aspect of your business that is not set-up correctly can shut down your whole operation very quickly. Legal advice is not cheap and even when you can afford it there is often a divide between lawyers and their clients. We want to close that gap once and for all. We want to put legal knowledge and tools into your hand to prevent the worst from happening to you.
Twice a week we are going to deliver those tools right to your home or office with Business Legal Lifecycle TV. We’ll start the week with Fast Fix Monday, a short 5-10 minute video that will tackle a single issue that businesses have to deal with. Then on Wednesday’s our main show will feature with more fulsome discussions and interviews all delivered in a straightforward and easy to understand format.