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The Truth About Selling Your Business

Asset Protection

The Truth About Selling Your Business

By , March 23, 2020

Selling Your Business

You’ve spent years building your business.  There have been times when you’ve invested in the business instead of paying yourself.  There have been tough times when you struggled to keep going and you’re still here.  When you start to think about extracting the value from your business your idea of its worth is often coloured by the amount of effort you have put into it.  So how easy is selling your business?

And how much is your business really worth?

Any Offers?

Selling to a third party is often a protracted and painful process resulting in either a lower price being finalised or no sale at all.  Current statistics show that around 80% of business put on the market never sell.  Alarmingly this has been the case for decades.

At What Price

Even if buyers are found for your business, the price they are willing to pay has everything to do with THEIR valuation not yours.  Many business owners sell for much less than they anticipated because they had no idea what the value of their business really was to a potential buyer.  At Succession Plus we’ve seen from personal experience the difference between a seller’s price and an investors valuation.  Often miles apart.

Who Represents You

Businesses are more often sold by brokers – people who understand business valuation and have a lot of contacts in the market so they know buyers.  Brokers have one aim, like estate agents, to sell as quickly and efficiently as possible.  An estate agent might suggest you clean your house up to make it more attractive but they still market the property as it stands.  Business brokers are the same.  The sooner they have interest and can get your sale across the line the better for them.  It’s always worth looking at a brokers track record before signing over fat fees.

The Process

Selling is not straight forward and there is no such thing as a “simple” sale.  The best brokers research the market and go out to find buyers by invitation so that they have a higher chance of concluding a sale for the best price.  They build a brochure called an Information Memorandum which is an over view of your business to attract some offers.  Once one or more offers are on the table you select an offer to go exclusive with and start the due diligence process.

Due diligence is where the potential buyer gets a really good look under the hood of your business.  They ask a lot of questions and ask for a lot of data.  The more prepared you are for this part of the process then the more likely a deal will be done at the price you have accepted.  When a buyer finds risks in the business they are likely to reduce the price they offer.

Preparation and Planning

The more pressure you are under to sell your business – because of health issues, a will to retire or other circumstances – the less power you have in the negotiation.  Advance planning will always repay you.  The first thing is to get an idea of the realistic valuation of your business now so you know what you look like to a potential buyer.  But you need more than just a business valuation.  You need to know where your strengths and weaknesses are and how to improve them.  This is where Succession Plus can help.


A Succession Plus Stage 1 Insights report shows you:

  1. Current business valuation
  2. Financial strengths and weaknesses
  3. Non-financial risks
  4. Exit readiness
  5. Attractiveness to a strategic buyer
  6. How you perform against your competitors and other in your industry
  7. An action plan for improving your business value so you can get more from your life’s work

Interested in find out what your business is currently worth? Try our FREE valuation tool by clicking here

Darryl Bates-Brownsword

Darryl Bates-Brownsword

CEO | Succession Plus UK

Darryl is a dynamic, driven Business Mentor and Coach with over 20 years of experience and passion for creating successful outcomes for founder-led businesses. He is a great connector, team builder, problem solver, and inspirer – showing the way through complexity to simplicity.

He has built 2 international multi-million turnover businesses; one now operating in 16 countries. His quick and analytical approach cuts through to the core issues quickly and identifying the context. He challenges the status quo and gets consistent, repeatable and reliable business results.

Originating in Australia, Darryl’s first career was as an Engineer in the Power Industry. Building businesses bought him to the UK in 2003 where he quickly developed a reputation for combining systems thinking with great creativity to get results in challenging situations.

A keen competitive cyclist, he also has a B Eng (Mech) Engineering and an MBA.