Sell My Business? 5 Reasons Small Business Owners Should Hold Onto It

You are the financial force behind your business, and you understand that part of success is knowing if and when to move on. As you plan an exit strategy to sell your business, you might wonder how to decide when you should hold onto your business instead of selling.

I am here to help you take complete control of the decision-making process. Let me share five reasons to hold onto your business.

Growth, Costs and Taxes

Growth

Is your business in a rapidly changing or high-growth industry? You naturally want to collect the rewards and increase the business sale price by selling after the growth spurt. Or do your projections show a dip in sales or slow growth? I can help you discover ways to optimize costs, improve efficiencies and prepare the business for a maximum payout. Potential buyers will evaluate the growth story your financials tell, so to successfully sell a small business (or any size business for that matter), there are steps you should take before beginning a sales process.

We talk about the mistake of ignoring business improvements before sale in this post Selling a Small Business? 5 Mistakes Making It Less Sellable.

Costs

Waiting before selling your business can be one of the best ways to maximize your company's profitability and asking price. Business brokers might pressure you into listing your business online, but if you can tweak your cost structure, it will directly impact your listing price. You can expand your customer base, protect your intellectual property, and research the sale marketplace with more time. Learn more about improving your bottom line to boost the valuation with the Ultimate Business Valuation Guide.

Changing tax structures or rates

Legislative changes can support your decision to wait. You realize that you might take a lump-sum payment that comes with lump-sum taxes by selling. Depending on the political climate, if rates are expected to be more favorable in the future, you may want to hold off selling any business assets.

Minimize Risk Before Selling a Business

• Legal and litigation issues can be the most detrimental barriers in deal-making when selling businesses. Holding out may be your only option if you are a business owner with significant current, ongoing, or potential legal issues. Let's wrap up any loose legal ties while you hold on to your business. During due diligence, you'll feel more confident about the sale knowing prospective buyers won't find any skeletons in your closet.

• Risk Management means considering other risks that may be a drag on your success and your motivation to sell, insurance costs, new government regulations, environmental issues, or safety and health risks – your potential buyer will be aware of these risks. Uncover and address these before you set out to sell your business.

Family or Personal Needs

Everyone has personal and family goals and aspirations. They keep you energized and future focused. You hope to operate your business until you no longer feel that energy and autonomy you started with. But personal factors such as a divorce or parent illness can make it challenging to keep going; they make it seem like the time to sell. Honor those feelings but consider how ready you are to sell.

Successors or lack of potential successors

You may need more in-depth planning before selling or divesting your business if you don't have succession plans. If yours is a family-owned company, you may feel pressure from family members to "keep it in the family." But it's wise to wait until the right employee or family member is ready. If you think they aren't, don't sell.

Employee or Human Resources

You may want to hold out on selling to honor ESOP (employee stock ownership), or maybe you just prefer to sell to current employees. Silent partner owners especially like knowing your company comes with experienced managers. Holding out for the right buyer who'll promise not to rock the boat after the deal closes can also be a strong motivator for waiting to sell.

You may want to hold out on selling to honor ESOP (employee stock ownership), or maybe you prefer to sell to current key employees. Silent partner owners especially like knowing your company comes with experienced managers, your most valuable intangible assets. Holding out for the right buyer who'll promise not to rock the boat after the deal closes can also be a strong motivator for waiting to sell.

Next Steps Before You Sell Your Business

Whether you've already laid the groundwork for selling your business and have plans in place, or you're ready to start thinking about selling but are unsure what steps, to begin with, I can help you plan your way to a successful sale. Get the Exit Readiness Report.