6 Ways to Increase the Value of Your Business
After investing years of hard work running your business, you’ll want to be sure you receive top dollar when it comes time to sell. Whether you’re looking to retire or are interested in other endeavors, there are many options you can employ to improve your business and receive higher offers from interested buyers. To help increase the value of your business, follow these six steps.
How to Increase the Value of Your Business
Choosing to list your business for sale is no small decision. Once you’ve figured out how to tell your employees and clients you’re planning to sell, you’ll need to prepare your business for the best possible asking price.
- Prepare Your Office Space
Before bringing interested buyers to your business, make sure it’s tidy and ready for showing. While investing in major renovations may be out of the question, ensuring the space is clean and organized will go a long way during the selling process. Minor improvements that are budget-friendly yet appealing to buyers include fresh paint, clean floors and spaces, and an overall clutter-free area.
- Invest in Your Employees
In addition to tidying up, a well-trained staff can also drive up your business’s value. If your staff will remain at the business under new ownership, it may be worthwhile to invest in their training. Finding quality employees can be quite time consuming and interested buyers may see a business complete with a great staff is worth more than others.
- Note any Included Equipment
Depending on the nature of your business, the cost of equipment and furnishings adds up quickly. If you plan to leave behind any equipment needed to run the company, advertise this perk to buyers. While these assets can result in a higher asking price, many buyers will be pleased with the convenience of the deal and happy to pay.
- Highlight Your Niche
If your particular market is highly saturated, highlight how your business stands out among the competition. While it’s ultimately up to the new owner to choose how to run the business, it can be helpful to show the current value in your business concept. Assets such as patents and other unique features can quickly increase the value of your business.
- Organize Your Books
Cash flow is one of the most common factors considered during business valuations. Be sure to organize your records to help show interested parties your business’ history and proven profitability. While new ownership can make or break a business, remember that all buyers are attracted to a successful, profitable business.
- Address any Other Risks
During the sales process, listen to interested buyers and consider their feedback. In many situations, buyers are hesitant to place an offer on a business due to the many commonly feared risks involved rather than just the asking price. To help increase the value of your business and support a higher asking price, consider addressing reasonable concerns from buyers.
If your business is ready to sell, consult a professional to help field offers and choose the best one possible. Contact Sunbelt Business Brokers of Lafayette to put our talented team to work for you today!
Brian Knoderer is the President of Sunbelt Business Brokers. He has over 20 years of experience as a business owner and managing business transactions. As a seasoned intermediary, Brian has successfully represented companies in a broad range of industries helping business owners achieve their desired exit strategy or growth initiative.
Brian is also co-owner of Sunbelt Indiana and Managing Director of MMI Capital Partners, a franchisor focused investment banking firm.
Previously Brian was involved in several entrepreneurial ventures as well as having held corporate roles in Franchise Development for Prime Hospitality and Choice Hotels.
Brian is a graduate of Ball State University with a degree in Management Information Systems and earned his MBA from Butler University. He has received the Certified Merger & Acquisition Advisor (CM&AA) designation, holds both the Series 7 – General Security License and the Series 63 – Uniform Securities Licenses, and is a licensed Real Estate Broker. He has been affiliated with several organizations including the Entrepreneur Organization, a Member of the International Business Brokers Association, Venture Club, and a Board Member of The Entrepreneur Institute.