We worked with a client some time ago who had a good little business churning out about $10 million in annual sales. They had previously worked with a Seattle business broker on attempting to sell their business. Unfortunately, their broker failed to deliver on glorious promises and after nine months of waiting the company had no offers and no marketing materials. It was appalling at best. The fact of the matter is that this is more of a realistic scenario than most business owners realize. According to surveys approximately 30 to 40% of businesses listed for sale actually ever sell. Most experienced business brokers and expert dealers will tell you this is probably accurate. Here are some questions that come to mind that bear thought-provoking responses:
If the business is large enough and is enough of a going concern to salvage, some professional M&A consulting services can be helpful in righting the sinking ship. Sometimes businesses are on the unfortunate path to self-destruction. Unfortunately, this is often the result of creative destruction and not necessary the consequence of ignorant or failing business operators. In short, some businesses are difficult or even impossible to save.
Having real-world experience in the size and type of transaction in which your business sits, is helpful for having a successful exit when selling your company. Entrepreneurs must also bear in mind that sometimes the right consulting firm can help right the wrongs prior to the sale in order to assist you in selling the business for the maximum amount possible. If owners can increase the value of their companies by several thousand by making some time-intensive tweaks, it can mean a great difference for the entrepreneur, especially if he/she is planning on moving into retirement. You can avoid being a statistic like the other 60 to 70% of businesses that actually do sell by going through the business sales process right the first time.