I have recently read a number of quotes stating that only 1 in 10 business owners successfully sell their company. Personally I believe it’s around 3 in 10 – which results in 70% of business owners not selling their business at the first attempt.
I have met owners who have been trying to sell their business for years. If you are wondering why they haven’t managed to sell then let me explain. Selling a business is similar to selling a car, although in most cases there is obviously more money involved with the sale of a business.
Years ago I purchased a lot of cars at auctions. I clearly remember many instances where I would arrive at an auction and enthusiastically find the lot number for my chosen target. Lots of people would be flocking around and examining it with a fine-tooth. It may have had a few marks but that’s expected. I would open up the boot and realise how very grubby it was inside. Some people would obviously be put off and would walk away.
Some of us would ask to see the service book and discover that the owner had never had the car serviced and that the V5 registration form was not available either. A few more people would lose interest and abandon the car whilst some would be thinking that they might be able to get a good bargain.
The driver would start the car and get ready to drive it into the auction hall. Upon listening to the engine – which didn’t sound good either, more people would lose interest. The few of us remaining would look inside at the dashboard and notice warning lights flashing everywhere – everyone would now walk away, resulting in not a single bid being placed on that car. At times the same car would go round week after week but no-one would buy it.
Similarly, when it comes to selling your business, it may appear to look good on the outside, and the numbers may be great. However, do you really know what the prospective buyers and their advisors will be looking for under the bonnet of your business? Furthermore, do you know what will actually put a buyer off from buying your company? Make sure your business is ready for the exit journey or you may find that interested parties completely lose interest and just walk away.
Please do get in touch if you have any questions or queries.
Wishing you every success.
About the author:
Malcolm Murray is a motivational speaker and trainer. He has delivered seminars/talks to over 50,000 people on topics such as ‘Selling a business to maximise value’, ‘Preparing a business for sale’, ‘Work–life balance’ and ‘Selling skills’.
Malcolm is the MD and Co-founder of the Entrepreneurs Hub, which offers business owners a unique business preparation approach for growth and exit, to make their company more robust, more valuable and more attractive to a potential buyer when they decide to eventually sell.
Please contact him at Malcolm@entrepreneurshub.co.uk