Many believe that those who sell their companies have financial issues. But the truth is, not all who sell their businesses do this as a desperate financial move.
There are times when tax reasons can influence the sale as well as personal issues. Some sell their company so that they can finally focus on their retirement. Others have ill health, forcing them to give up their brand. But for some business owners, they treat a business sale as an opportunity.
Running a business is already risky. But some would grab the opportunity to gain liquidity by selling shares or the company as a whole. Plus, since the company grows in value, you are facing bigger risks as time passes by. Some business owners would rather sell their companies to avoid serious risks.
When selling your business, you can face a set of new challenges. If you are not careful, you can end up feeling remorseful in the end. Be sure to expect these four common challenges as you proceed to sell your company:
Ensuring business continuity
If you plan to sell a business in Salt Lake City, for instance, then one thing you need to decide is how to ensure business continuity while working on the sale. Now that you are not just a business owner but a seller as well, you have more responsibilities on your plate.
Running your business while negotiating on a sale can be hard work. It’s best to hire a business brokerage company to assist you with the business sale. This way, you can focus on managing your brand and ensuring continuity.
Deciding between selling shares or the entire company
You have the option to sell a portion of the company or sell everything to your buyer. If you do intend to stay in the company, you will need to determine how long you plan on staying. What new role will you take, and how much shares do you plan on selling? Answering these questions before putting up the “for sale” sign is critical for all sellers.
Dealing with confidentiality issues
Sometimes, news of your decision to sell the company can break the sale or even affect the purchase price. If consumers or even staff find out too soon that you’re selling the company, it can greatly affect the business in many ways. Sales can go down while some of your top talents may choose to leave the business even before you close the deal. This is why confidentiality is a must when selling your business.
Handling pricing matters
Some business owners tend to sell their businesses without determining their true value first. For one, you cannot expect buyers to pay for more than your business is worth. You also don’t want to end up selling your company for a much lower price. By taking the time to know the value of your business, you can make the most out of the sale and start planning your exit.
There will come a time when you will ask yourself if it’s time to let go of your business. You can face different challenges if you proceed to sell. But preparing yourself as early as now will give you enough time to value your business, create an exit plan, and deal with the possible challenges you can face during the sale.