Deciding when to sell your business can be a complicated challenge. It is important to consider how holding off in the short term can lead to stronger opportunities in the future.
Whatever your reasons are for looking to exit your business, before proceeding it is worth taking stock and considering whether selling right now is in your, and your company’s, best interest. Here we consider some of the factors that are worth taking into account.
Examining the market conditions
It is critical to consider your market as a whole when looking to exit your business. While from a personal standpoint the time might seem right to sell, the conditions of the industry in which you operate in may not be.
Assessing the market conditions and the wider economic climate should provide a good indication of the level of interest you might obtain from a future acquirer, which makes the timing of the sale pivotal to strike the best deal.
Good things come to those who wait
Naturally, when optimising your business’ value, the best time to sell is when performance is strong, financials are trending upwards and demand for your company’s products/services is at an all-time high. However, exiting prematurely in a period of growth for the business can result in a missed opportunity to maximise its value. It is important to consider not only what your business is worth now, but also what the next 12 to 24 months could offer.
When it comes to owner-managed businesses, the general consensus is that a more established, more proven business with strong growth prospects will generate stronger revenues and profitability, thus attracting a higher level of value and interest as the risk is lower.
Speak to our team
Considering what’s best for your business? Magma Corporate Finance can provide you with an understanding of the correct positioning of your business, maximising value along the way and ensuring the exit from your business is at the best price when the time is right.
Speak to a member of our team below to find out more.
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