Selling A Business
How to Make Your Business More Attractive to Buyers
The market disruptions brought on by COVID-19 made the last two years difficult for many entrepreneurs, especially small business owners. With markets settling down, 2022 may be the year to sell your business and put your exit strategy into motion. There is a strong demand for existing businesses now and in the coming future, plus the U.S Census Bureau reported a record number of entrepreneurs applying for business applications. However, understanding how to sell your business and make it more attractive to buyers can be difficult and requires hard work. Luckily we’re here to help.
4 Ways to Make Your Business Listing More Enticing to Buyers
One of the most important steps in the sales process is finding potential buyers. There are plenty out there, but how do you attract them to your business over other opportunities? Here to lend advice to buyers is Ryan Cave, President of Sunbelt Business Brokers of South Florida. As a Certified Business Intermediary (CBI) and 10-time recipient of the Sunbelt National Sales Award, he is skilled in helping sellers prepare their businesses for sale and successfully closing transactions. Follow his expert insights to learn how to make your business more enticing to potential buyers.
1. Take Away the Buyer’s Objections
Buyers are bound to object to part of a sale’s terms. Understanding the main types of sale objections and how to overcome them can help you prepare. The process of taking away the buyer’s objections is a great opportunity for relationship-building between the buyer and seller because it fosters valuable communication and a deeper sales conversation. The best thing to do on your end is to provide plenty of information and be open in your discussions to ease any preoccupations or objections. Let the broker do the selling.
2. Consider Offering Seller Financing
Small businesses are priced on a multiple of the owner’s profit, and the multiple is a reflection of the buyer’s risk. The higher the multiple, the lower the risk. Seller financing can help lower the buyer’s perceived risk, which makes the business more valuable to the buyer.
It can also benefit the seller. Not only can it lead to an increased selling price, a larger pool of serious buyers, decreased income taxes, and an increased likelihood of sale, but it also provides the buyer with affordable monthly payments, avoidance of bank loans, and assurance that the seller believes in the future of the business. It may be worth asking your business advisor if seller financing is a good option for your business.
3. Price Your Business Correctly
Another important step is pricing your company correctly. A business that is presented and priced well will sell. A business that is priced too high won’t attract buyers, and a business that is priced too low shows that the seller doesn’t realize its fair value. Prospective buyers need to know that the market is active, and an offer from another aggressive buyer is often right around the corner. Sunbelt Business Brokers can help you determine the true market value through a professional business valuation. Once a price is determined, you will soon be ready to list your business for sale.
4. Be Transparent
Keep your business attractive with honesty. Don’t attempt to hide flaws or be deceitful in your business proposition. If a buyer uncovers discrepancies or weaknesses you attempt to hide, the deal may fall out, and business relationships may be ruined. Whether it be about financial statements, the company’s marketing strategies, partnerships, customer base, or its overall business model, be prepared to have an open conversation. As your business’s possible new owner, potential buyers want to know all the ins, outs, ups, and downs of your company, so they will surely ask questions. Instead of downplaying weaknesses, acknowledge them and offer attractive solutions. This will build trust and raise the potential for a sale.
Buyers are out there, and we can help you find them. Sunbelt Business Brokers will make your new business listing more enticing to attract the right buyers to your company. Contact an office near you today.