The selling of small businesses are hitting 8 year highs throughout America. According to BizBuySell.com, small business sales exceed 2,000 in the third quarter of 2016. That number is a 15% increase from 2015 and the second highest level of business sales since 2008, or right before the Great Depression.
Despite the ominous comparison, this is actually a good thing. While some are looking to sell their business as they transition to retirement, others are looking to sell in an effort to generate more capital for their next business. The main point of a business selling is the overall goal of the owner(s).
Daily Herald suggests that potential sellers have a 3 to 5 year plan in place to properly build their organization and get it ready to put on the market. I completely agree as it will generally take that range to properly build or make important company transitions. In addition, business owners must be flexible and realistic. Not every company is worth $1 million. In fact the median selling price for businesses on BizBuySell.com was $250,000.
As a business owner, it’s up to you to prepare your business to be analyzed and critiqued. There are many opportunities for a good deal, but small business owners must properly prepare for the that with a strategic plan, time, and effort.