Selling your business is one of the toughest things to do. It's not that you haven’t thought about it before, it’s simply an event that feels surreal, even when it is real.
Sometimes selling your business is an involuntary occurrence such as during a divorce, a death in the family, ill health or financial pressures. These scenarios are in many ways ‘easier’ because not selling is usually not an option.
But what about those other times? Those times when there is no genuine financial risk or reason compelling you to sell. How do I know when its time to sell my business - when I am not forced by external events or pressures?
The following 3 signs are good indications:
- Business value
Business owners should always consider any time a business opportunity arises to get liquidity for their business. This is especially the case if you receive the offer, and you quietly doubt whether or not the purchaser is getting value for their money. Running a business is risky and the longer you hold on to it, the riskier it gets. So, when you receive an offer and you secretly think: “I wouldn't pay that for this business” – you have probably reached the end of your journey.
- Drained of risks
When you start your new business, you are more likely to take risks, try new things or venture into new territories. But if your aptitude for risk dribbles to non-existent over time, it is a likely sign that your commitment to grow, expand and improve is at its end. It is important for older owners (those who no longer have the luxury of time to fix bad decisions), to purposely plan and look for opportunities to exit. Not because the business is necessarily at a bad place, but because it might be a very good strategic business decision.
Boredom refers to “feeling weary because one has a lack interest in one's current activity.” This should not be confused with feeling weary because of the slow progression of your business. Rather, it’s being weary because of a lack of interest in your business! It is that point where nothing that you do in your business excites you anymore – when you are not moved from within by your business, its achievements or its people. A business owner’s lack of interest is fatal to the business. It is a clear sign that it is time to intentionally explore an exit.
For more information about planning, preparing and exiting your business, please contact Philip van den Heever at email@example.com
This is not legal advice.