Selling a business is no small endeavor. There are documents to collect, decisions to make, emails to send, and so on. Needless to say, the process can feel daunting and overwhelming at times. This is why establishing specific, achievable goals can be extremely helpful as you go about bringing your business to market. Goals are a way to measure your level of success and productivity - giving you focus, direction, as well as tangible benchmarks to determine if you are moving in the right direction! Establishing goals will help put the various stages of selling a business into proper perspective, making the process much more manageable and increasing the likelihood of a successful sale.
1. Plan ahead
Setting your goals at the beginning of your selling process will help you get a more in-depth idea of what lies ahead, while also allowing you to focus on the smaller steps that come first! While setting goals in the early stages of your planning is ideal, it’s never too late to take a step back and reflect on your choices moving forward.
2. Write Down Your Goals
Having visual reminders of your goals can be a powerful tool for motivation. And not only that but having a tangible list, calendar, etc., to refer to can help you stay organized and efficient.
3. Set SMART Goals
You may have heard of these before, but if not this is an excellent acronym to plan and assess your goals. The acronym stands for:
S - Specific: your goals should be as specific as possible to give you a sharpened sense of direction
M - Measurable: give yourself realistic and measurable deadlines to finish each task
A - Attainable: make sure that your goals are feasible and possible to achieve to avoid discouragement and procrastination
R - Relevant: balance long-term and short-term goals accordingly to stay on tops of the task at hand
T - Time bound: having a finish line in mind gives you a sense of urgency and will also give you a milestone to celebrate when you’ve achieved your goals
Goals to Consider for Business Sellers
1. “How Soon Am I Looking To Sell?”
Determining your ideal timeline is an important first step. Keep in mind that a business sale may take between six months to two years, with a general average of about nine months (according to SCORE). Are you pressed for time? Do you have a few years to finalize the sale? Or are you somewhere in-between?
2. “How Much Should I Sell My Business For?”
Another important choice to make is your selling price. How much you can ask for depends on the pre-sale condition of your business. Most small businesses sell at a multiple of 2-4 times their annual earnings (also called cash flow). Ultimately, there are many ways to determine your selling price, and there are plenty of resources available to help you make this decision.
3. “Am I Open to Seller Financing?”
At first glance, many sellers are hesitant to provide seller financing based on the perceived risk that the buyer won’t pay them back. In reality, however, seller financing can benefit both the buyer and the seller. It can give buyers access to capital to buy a given business while helping sellers attract more buyers and ultimately get more money on the sale. This may also be a deciding factor for interested buyers - certainly an important factor to consider.
Related: What is Seller Financing?
4. “What Am I Looking For in a Buyer?”
Are you interested in selling to any qualified buyer? Would you prefer to sell to someone with experience in your industry? Visualizing your ideal candidate is a helpful component to identifying, and ultimately selecting, the right fit for you and your business.
5. “How Soon Can I Collect My Due Diligence Documents?”
One of your primary responsibilities as a seller is to ensure that you have all of your important documentation readily available for interested buyers to review. This is a necessary component of the selling process and setting a deadline to have this finished will help you stay on track as you gather and organize your information.
For more on this, please send us an email at email@example.com and request a copy of our Due Diligence Checklist and Company Questionnaire to help outline the documentation that all buyers will want to see.
6. “How Involved Do I Want to Be With the Business After the Sale?”
Would you like to stay involved with your business in a managerial capacity after its sale? Are you willing to stay on temporarily over a post-sale transitionary period? Or would you simply like to hand over your keys and walk off into the sunset? The choice is yours to make and considering this decision ahead of time will lend perspective to your dealings throughout the selling process.
Sitting down and taking the time to thoughtfully review these questions will only benefit you down the line. Selling a business can be frantic and unpredictable, and having a list of achievable goals to refer to throughout the process can help keep you grounded, level-headed, and productive. You may even adjust your goals along the way, but the outcome will remain clear. As Lao Tzu famously said, “The journey of a thousand miles begins with a single step.”