How Do I Know When It is Time to Sell my Business
Your business is your baby, you have invested years of blood, sweat, and tears birthing it, nurturing it, and growing it to profitability. Along the way, there have been many ups and downs; but through it all, you have experienced great joy in the journey.
With so much of their lives invested in their business, many owners cannot imagine not being involved in it anymore. And this can make it difficult to recognize the signs that it is time to get out. Letting go of something that has been such a major part of your life is never easy, but every owner eventually reaches the point when it is best to move on.
Here are four signs that it may be time to consider selling your business:
Retirement: Some people plan to keep working until they are physically unable to, but most would like to retire at some point and enjoy their golden years. If you are in the latter camp and you are approaching the age in which your goal is to retire, then it is time to evaluate your situation and develop an exit strategy. Is there someone in the family or an employee outside the family that you can trust to run the company while you step aside? Or do you need to cash out your business in order to fund your retirement? These and similar questions will need to be answered to help determine what your next steps will be.
Pressing Health or Family Concerns: Maybe you have someone close to you who has a major health concern. Or maybe your health is declining to the point where it is becoming more difficult to run your business. A pressing issue like this might also necessitate a relocation out of the area to be closer to a loved one who is dealing with a serious health condition. In a situation like this, you need to evaluate whether or not it is realistic to hold onto the business if more and more of your time will need to be dedicated to these other issues.
Your Passion for the Business is Gone: Many owners reach the point where they no longer enjoy running their business. Maybe you are getting tired of the day to day headaches, such as dealing with difficult employees, hiring, training, discipline, firing, compliance and liability issues, and other problems. The bigger a company gets, the more complicated issues like these become. Maybe you are at the point where you just don’t want to deal with it anymore and you want to move on to something else.
You are Hindering the Business from Reaching its Full Potential: This may be a difficult reality to accept, but in some cases as a business grows, the owner becomes more and more of a liability. For example, maybe you are very good at one particular skillset (such as sales), but the growth of your company has required you to lead in a number of other areas where you are not so strong. If this is where you are at, it makes sense to at least consider bringing in a partner who is strong in some of the areas where you are weak. If there is no suitable partner out there, then selling the business might be the best option.
You Believe the Value of Your Business Has Plateaued: Maybe you believe your business has already reached its full potential, or at least its full potential with you at the helm. It could be that competitive market forces are moving against you and that the company would be better off with someone in charge who is more aptly equipped to take on these challenges. When this is the case, it definitely makes sense to look at cashing out while you are in a position to receive an attractive offer.
How a Business Broker can Help with Your Sale: Selling a business is a very complicated process that takes a lot of planning in order to execute effectively. But doing this on your own can seem overwhelming, especially when you are still trying to run your business. This is where a business broker can be very helpful. Also known as business intermediaries, business brokers work closely with sellers to help them prepare their business for sale. They have an in-depth understanding of the process, and they can help overcome the common pitfalls that can trip you up along the way.