Avoiding The Potential Pitfalls Of Selling Your Arizona Business
What To Do To Evade Any Pitfalls When Selling Your Arizona Business
When a business owner is ready to sell their business, it’s common to fall victim to some common pitfalls. The can-do attitude that got you started in the first place can become a source of potential trouble when it comes to selling. An experienced Phoenix business broker can help you avoid these common problems.
Not Planning In Advance
A very common problem is lack of planning. Suddenly, a business owner decides they are ready to retire or want to travel. Unfortunately, an abrupt decision to sell your Phoenix business can lead to a reduced sale price and smaller pool of potential buyers. For a smooth and successful sale, you’ll need to take time to get your financial information in order, including profit & loss statements, balance sheets, tax returns, an equipment list, and a list of your inventory. This requires advance planning and professional consultation.
Not Having Third Party Representation
Since you already wear many hats in your small business, you should hire a qualified Glendale business broker who can value your business, set a fair asking price, screen potential buyers, and tend to the many details involved with selling a business, enabling you to stay focused on running your business. Ask for references and check for professional credentials to help you choose the right person for this important task.
Failing To Properly Market Your Business
If you want to sell your business successfully, you’ll want to retain the services of an experienced Arizona business broker. No one knows your business better than you do, so you will need to assist your business broker in putting together a Confidential Business Review (CBR) that helps to sell your business to potential buyers. You also need to advertise on the top online business for sale websites to expose your business to as many potential buyers as possible.
Quitting Too Soon
Once you’ve gotten through the sale preparation process, have an offer on your business, and scheduled an upcoming closing date on the sale, don’t stop running your business! Your sale is at risk of falling through if the potential buyer sees a major drop in sales. Continue to stay involved in your business and keep it healthy in order to encourage your buyer to complete the sale.
Setting The Asking Price Too High Or Too Low
It’s very common for small business owners to overvalue their “baby” and miss out on buyers by being priced too high. Or they underestimate the real value of their business and leave money on the table. Avoid this pitfall by getting a business valuation from a Certified Business Intermediary (CBI) who will price your business properly.
Wasting Time With Unprepared Buyers
You may get inquiries from people who are looking for information but aren’t serious about buying your business. They may not be ready to own a business or unable to get financing. Either way, don’t waste too much of your valuable time with unprepared and unqualified buyers. Ask a lot of vetting questions up front so you don’t get distracted and miss out on a potential buyer who is truly interested and prepared to buy your business.
Giving In To Deal Fatigue
Selling a business can take a long time – six months to a year is not uncommon! It may take months for a buyer to do their due diligence, secure their financing, and actually close on the deal. In the meantime, it can be tempting to take shortcuts or put less energy into running your business as you prepare for retirement or your next job venture. But don’t do it. “Quitting” mentally can cause a deal to fall through, and then you’ll have to start over.
Informing Employees Prematurely
Unlike selling a home, you usually don’t want everyone to know that you are selling your business. It’s best to keep a potential sale confidential until you close on the deal. You don’t want your employees to find out. Telling even one employee can cause damaging rumors that may kill your potential sale or cause other headaches, such as an employee demanding for increased pay or suddenly quitting.
Informing Customers Prematurely
In addition to employees, don’t tell your customers about the ownership change too early either. You may have customers who are emotionally attached to you or the way your company runs now. If many of your customers leave, it’s likely that your business will become unstable and that your sale will fall through. Keep the prospective sale under your hat until the deal is finalized.
Certified Business Intermediary In Phoenix
If you’re looking for a qualified business broker who can help you sell your Arizona business, there’s no better broker than Phil Reese. As a Certified Business Intermediary (CBI) with decades of experience, Phil is ready to answer all of your questions and help you get the highest price for your business. Call Phil today to get started!
Written By: Phil Reese
Phil Reese – Arizona Business Broker
Phoenix Location:
Email: philreeseaz@gmail.com
Website: https://www.philsellsbiz.com