It is not always easy to decide when it is the right time for you to sell your business and there are many lifestyle and financial issues that will need careful consideration. One of the key determinants in deciding whether or not it is the right time for a business owner to sell their business, is the financial value of that business.
There are a whole range of factors that affect a business’s value including:
- Historic profitability / EBITDA
- Current profitability / EBITDA
- Future growth and sustainable profitability / EBITDA
- Net Assets / Excess cash
- Cash flow
- Strength of recurring revenues
- Customer Retention record
- Macro-economic considerations / Market Outlook
- Strength of the business’s position in market
- Strength of Management Team and post-sale continuation
- Dependency on either one client, one supplier one individual including the founder
- Major risks to the business and the ability to mitigate
- The number of interested parties
- Synergies of interested parties
- Selling shareholders’ lifestyle aspirations
- Selling shareholders’ financial aspirations
- Tax planning
- Industry Sector Multiples
If you are not yet sure whether or not it is the right time for you to sell your business, we would be pleased to have a conversation with you to discuss the current valuation of your business in order to help you make the right decision, taking into account all the factors above.
To schedule a discussion and /or arrange a meeting, please contact us by phone or email. We look forward to hearing from you soon.