Selling Your Business?
At what point do you need to seriously consider selling a business?
“Eighty percent of businesses with revenues under $5 million never sell because, oftentimes, the owner waited too long. The worst time to sell is after the owner has lost his/her passion or at the end of a product or service cycle. The best time to sell is when the owner doesn’t really need to. However, this is counterintuitive for most business owners. A stagnant, declining or distressed business is difficult to sell. A growing one is the ideal situation. Yet, like the stock market, most sellers wait until performance goes down to sell and that’s a mistake.”
—Scott Osborne, managing principal, Pritchard Osborne Executive Ventures, LLC
“Ideally the development of an exit strategy should be a part of the strategic planning process for all companies. However, a period of three to five years before the exit date should enable most owners the opportunity to position the company for maximizing the potential value of a sale transaction.”
—Richard Siemsen, president and managing director, HBC Capital Advisors, LLC
“Deciding when to sell your business is a major issue. Some people sell and then realize that they really don’t like being retired or working for someone else again. Some people get caught up in the gross amount of selling price and don’t consider how much will really be left after paying taxes. The amount may seem large but is it enough to finance your retirement and allow you to live life style you want. Some people wait too long to sell and let their businesses diminish in value. Some die while owning the business and if they don’t have a proper business continuation plan their heirs my get little or nothing for the business. This is a very difficult decision to make and often put off too long.”
—Phil Brumbaugh, owner of Philip Brumbaugh CPA, CVA