By Bruce Hakutizwi
If you own and operate your own business, you’re likely in one of two situations:
- You’re a “lifer” that plans to either pass the business on to family or retire by selling it years down the road.
- You’re a serial entrepreneur who already has an exit plan mapped out and is working toward the sale of your current business and already thinking about the next one.
Both of these entrepreneurial aspirations can be very successful, and one thing that both types of business owners benefit from is the strategy and planning involved in carrying these plans out. In both cases, the business owner has time and opportunity to skillfully direct their business decisions in order to maximize the value of the business for whichever stated goal they’re trying to achieve.
But what if something throws a monkey wrench in that plan and, suddenly, you need to sell your business as quickly as possible? Any number of unexpected life changes can create a situation where you need to sell your business quickly.
- Serious illness
- Death of the owner
- Disasters or accidents (with inadequate insurance)
- Drastic financial reversals
In all these cases, the owner may decide that the best option – as opposed to taking on a large amount of debt to keep the business afloat – is to cut their losses and sell as quickly as possible.
What challenges does a quick sale create for the owner? Opportunistic investors whose main goal is to buy up companies at rock-bottom prices and quickly flip them for a profit love to identify a business owner who’s in trouble and in need of a fast sale. So, if that’s you, you can expect a number of lowball offers. In some cases, the situation is bad enough that that’s okay, and it’s good to know these offers are likely to pop up quickly and offer you a simple (if unsatisfying) out.
But, in many cases, these lowball offers will leave desperate business owners whose businesses are not incorporated holding onto a large amount of debt which can drag them down financially for years to come. Even if the owner is not quite desperate enough to accept an extremely low offer, they’re unlikely to get what they want to for the business if speed is of the essence.
How can you sell your business fast without regretting it? The first and most important thing for any business owner to consider, when the possibility of selling a business fast comes up, is whether selling is truly the best alternative for them personally. Are they willing to accept the fact that they’re unlikely to get what the business is truly worth if they want to sell it quickly? Are they willing to live with the fact that the sale is final and the business will no longer be in their control?
Unfortunately, many business owners make the decision to sell in the midst of a stressful – but temporary – situation, and then regret it afterward. If the decision is to sell, the best way to go about it is to put all business and financial records in order immediately and do whatever can be reasonably and quickly done to improve and clean up the premises. Both of these actions will put the business in the very best light for prospective buyers who may be willing to purchase it fast.
Then, the fastest way to locate potential buyers and negotiate a quick sale is to identify those individuals who already know your business well and who would logically be interested in owning it: your partners, employees, or competitors.
If no one on that short list of potential buyers is interested, or if something else prevents you from selling your business to them, your best bet is to invest in heavily marketing your business for sale to as wide an audience as possible through online business sale listings and other means.
Finally, if you truly want and need to sell your business quickly, you have to be willing to give more than you get during negotiations. No prospective buyer is going to want to offer a list of concessions when they know you’re desperate to get the deal done quickly. Your best bet is to get the best price you can to leave you in an equitable position when it’s done and then move on with your life.
Bruce Hakutizwi is the USA and International BusinessesForSale.com Manager for BusinessesForSale.com, a global online marketplace for buying and selling small to medium-sized businesses. The website has over 60,000 business listings and attracts 1.3 million buyers every month. For more information, download the free guide “Sell a business: a step-by-step Guide.” Connect with me on Facebook, Twitter, and LinkedIn.