You made a bold decision to open a business in the first place, and you’re wondering if now’s the right time to sell. Assuming your business isn’t failing, that you haven’t been throwing good money after bad, and that selling is the only option left to you, there are a number of reasons why you might want or need to sell.
In fact, there’s usually a combination of reasons. But so long as there’s no other immediate urgency, such as illness, either yourself or a family member, there are more favourable times to sell. (No business owner knows exactly when it’s right until after they’ve completed the sale and can view the transaction in retrospect.)
When is the right time to sell?
Here, Denise Barnes, author of Seller Beware – How Not To Sell Your Business looks at some situations which might point you in the direction of making that decision.
The time is probably right when:
- It’s no longer fun. This was my own reason for selling. I always said I would quit when I lost the feeling of joy at running my own business, not to mention losing interest in a field I’d once been passionate about, ie. estate agency. You put so much of yourself into a business: sweat and blood, tears and time, that your sense of enjoyment needs to carry you through even those dark, unproductive days.
- You’re feeling exhausted. This is a close cousin of number one. Either you’ve been working too long without a proper holiday, or you’ve simply no more mental energy left to inspire your staff, let alone yourself. This can easily happen if…
- The business has grown too big. You might have overstretched yourself and what used to be your precious business that you were in complete control of has become a monster. You’ve expanded your list of products or services, which has led to an increase in staff, and possibly moved to larger premises or opened up more offices. This has led to further expense and headache. The answer could be that you need a general manager, but it could also mean it’s time for a change.
- You want to change career. You’ve enjoyed the time you’ve spent setting up and running your business. But you’ve been doing the same thing for years, maybe decades. Perhaps it’s time to try something different. I’d always wanted to be a writer, and selling my business was supposed to give me the opportunity to pursue this. You may have a burning ambition to travel, or want to give more time to a hobby you love, or volunteer for charity work, but you can’t – you’re tied to the business.
- You’re planning a life-change. You want to get married, and/or have children, move house or even emigrate.
- You want to retire. You might wait until the official retirement age or take the plunge and retire earlier. You may have set this goal from the beginning, or considered the general retirement age made a natural break.
- Someone makes you an offer you can’t refuse. If it’s serious, and you or your business agent has vetted the person or company and it appears genuine, this might be a wonderful opportunity to take advantage of number 4, 5 or 6 above.
- The business is at its peak. You’ve got a fine set of figures to show any prospective buyer – ideally, five good years. Your premises sparkle with fresh paint. The staff are all loyal and hardworking, and brilliant at making sales. You could press on longer but feel this would be a cracking time to sell and reap the benefit of all your hard graft.
I’m sure you can add to this list, but the main thing is to use what you’ve been using all the time you’ve been running your own business: your gut instinct. It’s probably served you well in the past and will do so again. Now might really be the time to take that plunge. I raise my glass to you as you ride off into the sunset!