• Mon, Mar 16, 2020
  • Article Summary: Maximizing Your Business Value Before a Sale | Axial
  • Value
  •  by Gary Miller GEM Strategy Management, Inc. | November 1, 2017


    Background:
    • Selling a business is very complex.
    • Buyers are more cautious and much more rigorous in their due diligence efforts since the Great Recession. 
    • Deals fail because owners do not plan early enough to sell their business. 
    • Time and planning are required to maximize the sale price. 
    • Failure to plan often leads to a lower purchase price or no sale at all.

    The key to increasing business value is to understand how a potential buyer views your business:
    • Obtain an independent, professional valuation.
    • Engage an objective business adviser to conduct a business audit and assessment to reveal the key business value drivers.

    Key business value drivers may include:
    • Sales growth trends
    • Balanced and growing customer mix
    • Strength of sales backlog
    • Strength of the market niche
    • Strong products and services brand
    • Highly skilled, efficient and loyal workforce
    • Solid vendor relationships
    • Product differentiation
    • Product innovation
    • Strong management team to transition to the new owner
    • Robust management information systems
    • Continuous growth
    • Barriers to entry
    • Strong company culture
    • Loyal customer base 
    • Company culture
    • Existing customer relationships

    Conclusion:

    If you are considering selling your company, allow sufficient time to correct issues and build incremental value. Poor exit planning can erode the value of a lifetime of success.


    Article LINK


    Best,
    Eric J. Gall
    239.738.6227
    [email protected]