Business owners work hard to provide a good quality service to their customers but there can come a time when it makes sense to sell the business.
It’s not an easy decision and how do you know it’s going to be the right one?
5 Reasons Business Owners Choose to Sell Their Business
Let’s review 5 of the main reasons owners consider selling their business.
1. Retirement planning
There comes a time when it is more important to relax and enjoy life rather than work in your business every day. A retiring business owner is often someone who is keen to get the best value from selling their business but not at any price.
2. New investment required
Sometimes the owner has taken the business as far as possible and without new investment it cannot grow any more. New money and management may be needed to take the business to the next level.
3. Change in the market
Sometimes a particular type of business becomes popular: video rentals, tanning salons, payday loans are just some types of business that have become very popular at one point in time.
This could be an opportunity for an existing owner to cash in a heated market and get the very best possible price for the business at the top of the market.
4. Change in the legal / regulatory landscape
A business owner may sell because the government has introduced new legislation that affects how their business runs.
Examples include new environmental controls for building firms, new privacy laws for technology companies or a change in government subsidies for medical firms.
The owner may choose to sell the business rather than adapt to the new laws or regulations.
5. New opportunities
A business owner may have been offered or seen another business opportunity in another industry. Selling their current business can provide the capital to begin a business elsewhere.
Whatever the reason for selling a business, every business owner will need to consult a wide range of professionals including lawyers and accountants to ensure all the financial and legal implications from the sale are fully understood.
Preparing Your Business for the Due Diligence Process
An important part of the sales process is preparing your company information for the due diligence process. The smoother the due diligence process is for potential buyers, the more likely an owner can sell their business.
A proven way to ensure the most efficient due diligence process for a business sale is to create an online data room where all documents relating to the sale. Documents are available in a secure online location and the ability to review these files is limited to prospective buyers.
Docurex provides organizations with a secure, online data room to ensure transparency and fairness in critical business sale transactions.
Contact Docurex for more information today.