5 step action plan to sell your business

As a business owner, you may not have initially thought about making your company sellable. Early on, your focus was likely on growing and running your business. However, at some point, you might decide that it’s time to sell—whether due to retirement, a desire for a new venture, or other reasons. If this is the case, you'll need to make certain strategic changes to ensure your business is ready for sale.

Is Your Business Ready to Be Sold?

Many business owners believe that because their company is profitable, it will easily sell. While your business may indeed be unique and valuable, potential buyers usually look for specific factors before they consider purchasing. These include:

1. Clearly defined processes that others can follow.

2. Established operational systems.

3. A method for transferring the business from the current owner’s direct involvement to standardized, proprietary processes.

4. A way to pass on critical business knowledge.

If your business relies heavily on your personal expertise and doesn’t have a clear way to transfer that knowledge, it may not be easily sellable. Fortunately, there are steps you can take to increase your company’s marketability.

5 Strategies to Make Your Business More Sellable

During a recent conversation with Rohit Anand, Director at Regalton Capital LLC; Adi Klevit, CEO of Business Success Consulting Group, discussed what makes a business attractive to investors. Here are five key strategies any business owner can implement to improve their company’s sellability:

1. Extract and Document Business Knowledge - Many business owners are the primary holders of specialized knowledge about the company. This makes transitioning to a new owner challenging. To make your business more sellable, you must systematically document and share this knowledge, so it’s easily transferable to someone else when the time comes.

2. Document Processes and Procedures Across Departments - A business doesn’t run on the CEO’s knowledge alone. Each department has its own processes that should be documented. Owners often have this information stored in their heads, but new owners can’t rely on this. By documenting processes and procedures for each department, you make it easier for new owners and employees to understand and follow your company's operations.

3. Document Business Culture - Every business has its own unique culture, and this can be a key factor for a potential buyer. Whether your culture is formal or informal, stable or evolving, documenting it is essential. This helps ensure the new owner can maintain and nurture the culture after the sale, which can be an attractive proposition for potential buyers.

4. Consult an Expert - If you haven’t yet documented processes, procedures, or knowledge, it might be time to bring in a consultant. A professional can help extract, document, and systematize your business practices, making it more attractive to buyers. Consulting with a specialist will help you ensure that the necessary documentation is in place for a successful transition.

5. Consider a Co-Ownership Agreement - To help smooth the transition, consider including a co-ownership clause in the sale contract. By agreeing to stay on as a co-partner for a period after the sale, you provide the buyer with hands-on experience in managing the business. This allows them to get comfortable with your documented processes while still benefiting from your expertise.

   
   

Ready to Make Your Business Sellable?

If you're serious about selling your business, consider working with a team like Regalton Capital LLC. We specialize in process documentation and knowledge transfer, helping you prepare your company for a successful sale. Reach out to us to get started on making your business more sellable today!