TIP ONE – SET THE RIGHT PRICE FOR YOUR BUSINESS
You can only sell your business once. You don’t get a second chance, and you can’t go back and do it again. So you want to get the best possible price that the market will pay. Later on in this report we’ll show you how to do that. But before we look at how to get the best price, you need to think about how to set the right price for your business. Remember that most buyers want to pay the right price. This does not mean that they want to pay as little as possible. In fact, most buyers feel suspicious if the business is too cheap. Buyers feel more comfortable if they pay what they think is a fair price. Think about it. If someone offers you a new Ferrari for $10,000.00 you immediately think “What’s wrong with it?” Of all the things that determine how long it takes to sell a business it’s not clever marketing, or internet, or referral, or anything else – it is THE PRICE. Getting the price right is critical! The first few weeks of marketing a business are critical. If the price is too high you’ll have a “stalled start”. To avoid a poor start you need to properly and accurately estimate the value of the business. Estimating business value is a skill, learned over many years. Only experienced, competent professionals can capably evaluate the value of your business. A business is not worth what you owe the bank, or what you need to pay off debt – it’s worth what the market will pay. But there is a way to get the market to pay more – which we will look at shortly. It may be necessary to get several professional opinions of the value of your business, as only one may be too high or another too low. Take time to get the price right – it is worth taking the time to get the price right at the start. If you have an independent business valuation done, you will be able you use that valuation to provide justification for your selling price. This technique will help eliminate negotiation on price from the buyer, and the cost of the valuation will be more than recovered in the selling price. On some rare occasions it may be best to offer the business with no asking price at all.