Why don’t some business sell?

It’s a sad fact that in the UK 4 out of 5 privately owned business will fail to sell.  Our experience shows that there are 4 main reasons that contribute to this and they are all things that can be rectified before the owners put the business on the open market.

    1. The first is lack of preparation.  It can take several years to prepare a business for sale but those owners that do prepare in advance achieve higher prices and better deal structures.  And of course their companies have grown and become more saleable as a result of their actions.
    2. The second, very common, reason is poor financial reporting.  Many business owners don’t prepare monthly management accounts and, amazingly, make financial decisions based on what cash is in the bank.  During the business sale process a company’s financial performance is under intense scrutiny so they must stand up.
    3. Not all that surprisingly, owner reliance is the third reason.  The majority of SMEs are owner-managed and generally provide their owners with a reasonable lifestyle. However, when the time comes to sell the business it reduces the value of the business considerably. After all, you won’t be selling you and your skills, experience etc.
    4. Unrealistic price expectations are the fourth reason and that’s partly because the owners haven’t had an independent valuation so their expectations are out of line with the market.  That is so easily resolved and costs nothing – we provide a free online report (26 pages) just go to http://www.evolutioncbs.co.uk/free-valuation and fill in the online form; it takes about 20 minutes.

Here’s a short video that gives some advice:

 

If you would like to know more about preparing a business for sale come along to one our free events; these are packed with invaluable information and are completely confidential.

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