Alan has run a hardware store for the past 20 years. With retirement only five years away, he is beginning to prepare for the sale of his business.
Planning for the sale of a business is a smart move. Alan should have plenty of time to clean, paint, and get things in order for the sale. And to make his business more financially attractive, there are several steps he can take as well.
The first step is to focus on the profitability of the store. Prospective buyers will want to see at least three years of financial statements, so Alan has some time to try to improve the store’s financial results. To potentially increase sales, he may want to consider expanding the number of hours the store is open. Concentrating only on products with healthy profit margins that sell quickly and disposing of any slow-moving inventory may also enhance his bottom line.
The next step is to review vendor contracts, especially those that are exclusive agreements. It’s important for Alan to maintain good relationships with his suppliers — without interruption — until the store is sold. The loss of an exclusive line of products could cause a prospective buyer to think twice about purchasing the business.
There are many details that need to be considered before you sell your business. Planning in advance can help put you in a better position to command top dollar for your company.
Client Profile is based on a hypothetical situation. The solutions we discuss may or may not be appropriate for you.
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