The turn of the calendar signifies a new year, a chance to start fresh and work hard to make something happen. For business owners, that may mean a new plan, a new framework, a continuation of what’s worked in the past and an alteration for things that didn’t work so well.
For those who are planning to sell their Palm Beach FL business, the new year signifies the perfect time to get things in order, to position your business as best as possible for the transition to a new owner.
Recently, we covered some end-of-year planning you could do to set yourself up for success in the new year as you look to sell. That included creating forward-thinking plans, being mindful of your tax write-offs and preparing your marketing materials.
If you weren’t able to implement any of those changes before 2019 ended, or if you only recently decided to sell, there’s no reason to fret. While the calendar has already flipped to 2020, it’s never too late to make resolutions.
Here are four resolutions you should make for yourself this year if you’re in the process of selling your business.
1. Solidify Your Leadership Team
If you’ve been in business for a while now, it’s likely you already have a leadership team in place — even if it’s not as official as that of larger corporations that have a C-level executive for every department. At the very least, you probably have people in place who lead the different departments of your company and then, in some fashion, report up to you.
But is your leadership team set up to run your business only for how your business is set up now? Or are your leaders flexible and nimble enough to adjust to a new ownership team?
People are what make a business succeed … or fail. And the leadership team is the group that ultimately is responsible for those outcomes.
Now is the time to analyze the makeup of your leadership team and make any necessary changes so your business is prepared for a transition. A strong leadership team will be a large selling point to any potential buyer.
2. Clean Up Your Operations
We’ve mentioned this before, but it bears repeating: People who buy businesses want to see solid processes in place. No matter what industry and no matter what terms of the sale, any business will go through a transition period when it changes ownership hands.
It’s during this transition period when a business can be most vulnerable. Solid, written-out and formalized processes can help ease the transition and guard against possible fall-outs during the transition.
3. Clean Up Your Finances
In terms of resolutions, this doesn’t mean to just get your books in order so they are easy for a potential buyer to decipher. Instead, take a good hard look at your balance sheet and make difficult financial decisions in the first half of the year that will set you up for a more profitable sale later in the year.
This may mean foregoing extra profits or investments into the business in favor of paying down debt on financed equipment, vehicles or other loans. It may mean holding off on previously planned projects such as purchasing new furniture or painting the office.
In no way should you make massive cuts to your expenses so your balance sheet looks more favorable to potential buyers; that would ultimately hurt you in the end. But making a smart, strategic cut here or there — or paying down debt at an accelerated rate — could net you bigger proceeds when negotiations start.
4. Get a Legal Team in Place
Depending on the size and nature of your business, you may or may not have a legal team in place. You may or may not have any legal representation at all. While a legal team isn’t always necessary to run a business, one will certainly come in handy when you’re selling a business.
Even before you officially list your business for sale or start searching for a buyer, ironing out the legal aspects of selling your business is a smart move. A legal team can help protect your assets, your interests and your wishes.
A legal team’s value is much greater than just creating and/or reading over contracts. A good legal team can certainly help you structure the sale of your business in a way that gets you everything you want — or as close to it as possible, but they can also help you prepare your business for sale well before the contract stage.
They can take a look at how your business was formed and how it’s structured and suggest possible alterations now that will make your business more attractive to potential buyers. They can also take a look at the contracts you have in place with vendors and clients to see if anything can be re-worked to your advantage.
Hiring a legal team well before a sales prices is agreed upon can have a huge positive effect on how the sale of your business goes.
Make these four resolutions for yourself in 2020, and you’ll be well-prepared to sell your business for the best possible price.
If you are planning to sell your Palm Beach FL business, talk to a Sunbelt South Florida business broker today!
Sunbelt Business Brokers of West Palm Beach provides dedicated business brokerage services for all of your selling needs. Whether you are an established business owner nearing retirement and looking to sell, or an ambitious entrepreneur seeking your next investment opportunity, there is no reason to look beyond Sunbelt Business Brokers. Visit us at 800 Village Square Crossing Suite 216 Palm Beach Gardens, FL 33410 or contact us at (561) 832-9222.