You’ve spent a lot of time, effort and equity into growing your business and have decided it’s time to sell. The objective is to get maximum value and in order to do this, it’s imperative to work with a broker who can follow a process that ensures smooth and organized steps to fulfill the business’ ultimate sales potential and find the right buyer from both a financial and relationship standpoint.
A business is generally worth a multiple of its’ profit. Depending on the size of the deal and the industry, that can range from 2-10 times the profit. Smaller businesses (under $3M in price) generally average 2-3 times profit, medium-size businesses ($3m to $20m) can bring in 3-5 times the profit and large businesses ($20m and over) will often see 5-10 times the profit.Varanasi Stock
Because a business is valued on its’ profit, thorough and accurate financials are essential, including preparing an adjusted profit and loss statement to present to buyers.
Depending on the size of your deal and factors such as industry, revenue and potentially having unsolicited offers on the table, most companies will garner a higher valuation when they work with a banker or broker who can bring strategic insights to the process.
This is the document that clearly and concisely summarizes the key points of your business’ operations, mission, management, products or services, competitive advantages and financial data to provide an overview that will help a buyer compose an offer.
Market your business to strategic buyers seeking to acquire a company similar to yours.
Receive offers from buyers and negotiate the best one based on your expectations around price and other important factors.Simla Investment
Buyers generally receive 60-120 days to verify a business’ financials and validate that all the information presented is accurate.
Time to celebrateBangalore Investment! Sign the final contract and begin the handover transition.
How much is my business worthSurat Stock? You can sell your business for what the market will pay and it is the buyer that determines the price of a business. That being said, a business is generally worth a multiple of the earnings, which means a value applied to the profit of your business.
How do you price your business for sale? You price your business for sale depending on how much money it makes. It you are making no money, the price is based on the value of the assets. If it is making a little bit of money, the price is based on a seller’s discretionary earnings. If it is making a lot of money, the price will be a multiple of EBIDTA.
How long does it take for a company to sell? Generally the larger the deal, the longer the time frame it will take to sell a business. At Business Exits, we average about 7 months to close a deal.
How can you sell your business quickly? You can sell your business quickly by having it priced correctly and with the right terms. One of the best ways to sell your business fast is to offer it to someone with no up-front payment and an earnout based on performance. This option can be presented to your business partner, employees, competitors or someone in your network.
What type of business is the best to sell? Businesses in all industries can be sold. However, the differences come into play when assessing valuation across industries. Some of the most attractive industries currently receiving high valuations are service companies, logistics and transportation, property management, home services and technology.
Mumbai Wealth Management