Maximizing the Value of Your Business Before Selling
There are several things a business owner can do before offering the business for sale in order to maximize the number of offers and selling price:
- Make certain all state and federal tax returns have been filed and your accounting records are in good order.
- Prepare a current balance sheet and year-to-date income and expense statement.
- If possible, settle any litigation or threats of litigation.
- Have an independent insurance broker review all business insurance policies to see if premiums can be reduced.
- If your business lease has less than 5 years remaining and your location is important to your business, attempt to negotiate an option to extend the term, making certain that a buyer can assume the lease based on reasonable conditions.
- Make certain you can deliver an operations manual, describing all systems and procedures to the buyer.
- Carefully calculate the EBITDA for your business and be certain you can justify it.
- Make certain you have an up-to-date, modern website that describes your business and the products and/or services your company offers.
- Create formal written agreements with any key employees and clients/customers if appropriate and helpful.
- Improve the appearance of your business premises with fresh paint, cleaning, etc.
- If possible, payoff any business debts
- Sell any unused, unneeded, obsolete equipment