Deciding to sell a business is one of the biggest decisions a business owner makes. At BayState Business Brokers we help business owners evaluate if now is the time and if so, how to prepare so we can market the business to find the right buyer and maximize value. As we work together, we ask one thing of our sellers – do not take your foot off the gas!
What do we mean by ‘taking your foot off the gas’? By this we mean stopping marketing, selling and working on the business that you have worked so hard to build. From the point you decide to sell to the time the transaction is complete, you need your foot on the gas, actively running the business. At any point before closing, a deal can be renegotiated by the buyers if there are significant changes in the business.
At BayState Business Brokers we have seen deals change when a seller has one foot out the door once deciding to sell. If your goal as a business owner is to get the best deal, you need to continue working at your business.
Keep in mind, the sale of your business may take months. From the initial marketing of the business to initial discussions with interested parties to due diligence, financing and negotiating final terms, selling a business can be a lengthy process. It is important to have the mindset of being committed and not to check out too soon.
Don’t Be the Seller Who Takes Their Foot Off the Gas
If you take your foot off the gas when selling your business, the pending deal is likely to be reduced or altered to benefit the buyer. Below are two examples of how our past clients took their foot off the gas.
One seller had his business on the market and it took some time to find an eligible buyer. A deal was agreed to, but the timeline to closing was extended. It was during this time that the seller took their eyes off the ball. They were focused on the end goal of closing and in turn, their revenue dropped. The deal was renegotiated, and the seller was forced to accept a reduced offer due to meaningful changes in the P&L.
Another example is a business owner taking their foot off the gas where a buyer had been identified quickly. When the buyer was identified the company ceased all marketing efforts; the pipeline evaporated, and the strengths of the projected financials declined. The seller was fortunate that the buyers renegotiated certain aspects of the deal but did not renegotiate purchase price.
If you are thinking about selling your business, please read what matters most to potential buyers. We have also written a blog about preparing for the due diligence process when selling your company and the key details needed to sell successfully. As a business owner, you have worked so hard to build a company worth selling. This proud accomplishment should not be overshadowed by slow sales and marketing at the end of your reign.
At BayState Business Brokers we work to market your business and get the best deal possible. When selling a business, it is a partnership and sellers must continue working at their business until closing to get the best deal possible. If you are thinking about selling your business, we welcome the opportunity to help you every step of the way. You can count on us to quarterback the process of selling your business, and we will count on you to keep your foot on the gas. Contact us.