5 Tips For Selling Your Small Business

Reprinted from NBC Chicago’s Inc. Well post on August 31, 2011

“This past month, I sold The Bumble Brand. Turns out, selling my business was a lot like starting one up. Oh, the things I wished I had known. I was reminded once again that there are certain things you can’t know until you experience the process firsthand.

Nevertheless, here are a few tidbits I uncovered along the way:

1. There is no such thing as the “right” sale price. The exact sale price of your business is in the eyes of the beholder — or rather, the price will be what you and the buyer feel the business is worth. I’d suggest staying flexible: If you’re stuck on $300,000 and no one is willing to pay that, then by all means bring it down. Similarly, if you’ve got low expectations but you meet someone whose pockets are dripping with the green stuff, be bold and raise that number. I met buyers who balked when I stated my asking price. And I met buyers who didn’t wince even once at that same number. Take the Stephen Colbert approach on this one and go with your gut. If it feels right, it may feel right to the future owner of your company, too.

2. Keep your business going. Don’t stop running your business while hunting down a buyer. They want to see that you remain profitable even as the transaction occurs. In my dealings with buyers, the fact that The Bumble Brand had ceased to be my first priority put me at a distinct disadvantage. In retrospect, it seems obvious. But at the time it simply didn’t occur to me that easing off the accelerator would negatively impact the business’ value.

Read more here.