The Top 5 Mistakes that May Prevent You from Selling

The Top 5 Mistakes business owners make that prevent them from selling are:

• 1. Overvaluing the worth of the business – business owners almost always think their company is worth more than it is to prospective buyers. Be mentally and financially prepared to consider and possibly accept a lower offer.
• 2. Poor financial records – buyers always want to see 3-years of tax returns, profit and loss statements, and cash flow reports, to name a few; be sure yours are in good order and ready to be sent.
• 3. Being unprepared – if your equipment is in rough condition, your physical store is a mess, or your employees don’t even know who’s the boss, you might need to do a massive overhaul of your operations before the site visit!
• 4. The business can’t run without you – you have been a good owner and did so many things yourself that no one knows how to do anything without you. Learn to let go, document your processes and delegate. Buyers will want to be able to take over seamlessly.
• 5. Market conditions or special circumstances – be aware of situations that you might be tempted to ignore or come up with excuses for because buyers will be researching market conditions. Examples of this include natural disasters that might have vastly increased business but only for that one time, downward sales trends that you justify in your mind but that buyers don’t agree with, or outdated/obsolete products or services that need to be updated or replaced.
• I made and learned from all of these mistakes to some degree. Before working with me, my clients made these mistakes too and some to a much higher degree and to the detriment of the sale of their businesses. The companies have always sold, but there has been some disappointment along the way. Buyers may not have been able to get financing, the final sale price may have been lower than the original asking price, and/or the process took significantly longer than expected.