Four Tips for Getting the Most From Your Life's Work
Your business is your baby, but the baby’s grown up.
It’s served you and your employees well. Your business has helped turn your passion and talents into income for you and your family, as well as your employees and their families.
But have you considered what comes next?
Has the thought of selling your business ever crossed your mind? Maybe you’ve thought of starting a new business, or a new chapter in your life. Even if you’re not 100% sure you actually want to sell your business, there are a few basic strategies to put in place now to help ensure you get full value.
Consider transferring business income to your personal balance sheet over time.
This cash flow strategy helps in two ways: It builds your personal balance sheet, and may alleviate some of the pressure you may feel to get “top dollar” for your business.
According to the IBBA, for businesses valued up to $1 million, 51% of buyers come from a 50-mile radius; in 32% of these cases, buyers are found within 20 miles. For companies valued at $5 million and up, the net is a bit wider; buyers come from more than 100 miles away in 77% of cases.1
Do some soul-searching.
Many owners believe they will sell their business to the first person who offers the right price. But once potential buyers start calling, sellers usually realize that they want more than money. For instance, if you have spent 30 years building a business, you may not be happy to sell it to someone who wants to rebrand it and put his or her name on the signs.
Many sellers know that being too optimistic about pricing can stall a deal, but they still make this critical mistake. In fact, it’s the top error made by sellers, according to IBBA’s survey, cited by 39% of business sale advisors. Again, consider a cash flow strategy for your business now that strengthens your personal balance sheet. It could relieve the pressure to get every last dollar, should you ever decide to sell your business.
Guardian, its subsidiaries, agents and employees do not provide tax, legal, or accounting advice. Consult your tax, legal, or accounting professional regarding your individual situation.
Pub11528 2022-136889 Exp. 4/24