How to know when it’s time to sell your business

When it comes to choosing the next steps for you and your business, it can be difficult to feel settled in a decision. Building a business takes a lot of time, energy, hard work and commitment, and as a result it’s not uncommon for business owners to become both financially and emotionally invested in their venture. 

Whether you’ve been building your business up for several years, or you’re relatively new to the game and are now seeking new opportunities; whether you’re looking to see some returns on your investment, or to take a step back and start planning for your retirement, it can be tricky to know when to start making the first move in selling up. We’re here to help. 

Reaping the rewards from your investment 

You’ve invested time, energy and money into developing your business – now could be the perfect time to start reaping some of those well-earned rewards! 

Whether you’re ready to move on and pursue new business opportunities, or you’re approaching retirement and are ready to hand over the reins to a family member or trusted colleague, selling your business can release a large sum of money, providing you with the financial freedom to commence the next chapter of your life. 

With this in mind, it’s always advisable to sell your business when it’s doing well if you’re looking to achieve the best price for it, as your profits are likely to be a key focus for potential buyers and will ultimately impact the offer they’re willing to make. 

A business with dwindling profits is likely to be less desirable to potential buyers, and any who are interested will be looking to negotiate on your asking price and expect you to sell for less. For this reason, it may make more sense to stick around for a little while longer and make any improvements that you can in order to place the business in a stronger financial position prior to listing. Need to chat through your options? Get in touch with our expert team today! 

Switching things up with changes in management 

Whilst you may be financially and emotionally invested in the business you’ve built, it makes sense to take a step back every once in a while and really think about what you are continuing to bring to the table, particularly if you’ve experienced a period of growth. It’s not uncommon for owners who have built their business from the ground up to find that as it has grown, the role of owner no longer allows them to really make the most out of their personal skill set and strengths. 

As an example, it may be that your incredible sales skills are what your company has essentially been built on, but you now have a team of sales staff who are out there winning customers, leaving you to take on an entirely new role, perhaps dealing with business finances or HR issues instead. In this case, it can be very beneficial for you to take a step back and hand over the reins to someone whose skill set is better suited to the ownership role, allowing you to rest assured that the business you’ve worked so hard to build is being left in good hands, whilst you can reap the rewards of all your hard work. 

Finding your passion elsewhere 

It’s a sad fact, but it does happen, that many business owners who have spent years developing their business find themselves losing interest in the day-to-day running of it all. It can be tricky to recognise this and admit it to yourself, but it’s important, if you are at this stage, to acknowledge it, as once your passion begins to dwindle, it’s often the case that standards do too, which will ultimately harm the business in the long run. 

If you no longer feel excited in your role, it may be the perfect time for a career change! 

Pursuing other business interests 

On the flip side, it may be that you still love what you do, but you’ve been sitting on an idea or a concept for a new business that really gets your creative juices flowing. Whilst the business you’re in may be close to your heart, staying on as owner and giving yourself the responsibility of running it could ultimately lead to lost opportunities. It may sting a little bit to sell it, but letting it go to someone who has the passion and the resources to really make it work could be the best decision, and will allow you to pursue new business ideas, opportunities and interests. 

Planning for succession and retirement 

When planning for retirement, it may be that making the decision to sell your business, and the timing of that, is dictated by a number of factors; whilst health may be a concern, you will also be keen to try and achieve the best price for your business, as the price you achieve is likely to be what funds your future. In this instance, we advise you to get in touch with our team to chat through your options and begin making plans now, so that the process is made easier when the time eventually comes. 

As we’ve already touched upon, the reason behind making the decision to sell your business doesn’t always boil down to financial factors – personal factors can contribute to this too. It may be that you’ve recently experienced a big life event – childbirth, marriage, divorce, the death of a business partner or loved one – and found that this is driving change in your life. Other personal circumstances, such as increasing stress or ill health, may equally play their part in bringing you to the decision to sell. If this is where you’re at, then it may be that the financial aspect (i.e. the desire to get the best price for your business) needs to take a back seat, and achieving a timely sale is made the main focus. 

Ready to take the leap? Get expert advice on selling your business with Pearson Ferrier. 

Established in 1996, Pearson Ferrier is proud to employ a dedicated team of passionate property professionals, who have each worked hard over the years to make the company what it is today – one of the best and highest regarded estate agents in the North West. Get in touch today!