The Opportunity- As succinctly as possible, where is your business and what does it do? What is the opportunity for the new owner?  

The Financials- have prepared 3 years profit and loss accounts which you can substantiate to any qualified buyer. Add back to your bottom line profit the expenses specific to you. For example owners drawings, car leases, personal travel etc.  This increases the profit and more accurately reflects the business income.

The Assets – establish an Asset Register listing the major assets and assign $ value to each item.  Be realistic and remember the value is what the market will pay and may not be what it has cost you to buy and refurbish an asset.

The Price- Business Valuations is based on specific financial formulas. When you attract a serious capable buyer (and these can be rare) most will base their offer on one or a combination of these formulas. This is a specialist area, get some advice. If the valuation (and hence the sale price) is too high the business often will take too long and may not sell. If it’s too cheap   it sells quickly but you’re left feeling you missed out.

The Time- There is 2 things to consider here.  Firstly, many sellers don’t spend enough time getting their businesses ready to sell and therefore don’t get the best price. Addressing the points above and building strong forward bookings takes time. Take the time, you will be rewarded.

Secondly, many sellers considerably under-estimate the time it will take to sell their business. While it does happen that a buyer is ready and acts quickly after a business is listed, this is very much the exception not the rule. As a best guess (and it is really just a guess) allow 6 months from listing to find a capable buyer. This potential buyer will usually spend time requesting information, have it analysed by professional advisors, flying to inspect your business, negotiating and completing a contract, organising finance (if necessary), completing a thorough due diligence, resolving any issues that arise from this, and then look for a sufficient handover period-  allow a further 6 months. So 12 months total as an indication. 6 months for a buyer to find you and a further 6 months if you’ve done the work to be ready to sell and things go smoothly.