How To Structure A Marketable Business
Many business owners operate profitable enterprises but, this does not necessarily imply a marketable business. A consultant who works alone, for instance, has nothing to sell. In this instance, “their expertise” refers to the entire enterprise.
Ensure that you are building a marketable business in the future.
If you currently own an unsellable business, there may be steps you can take to improve its marketability. It is prudent to establish a business that can be sold for the highest price in the future.
Utilize these strategies to structure a marketable business
Ensure your skills aren’t the only value in your business.
If you are the only source of income, you severely restrict your ability to sell your business. This may necessitate the employment of additional value-providers.
Over time, attempt to remove yourself from the income producing activities.
Many business purchasers seek to acquire a company that will enable them to create a full-time position for themselves. However, many other buyers prefer to be investors. They seek a business that can be managed remotely with minimal time requirements.
Project possible income.
Potential purchasers are interested in the income they can anticipate earning. Numerous companies sell for multiples of their anticipated annual income. The precise factor differs based on the type of business.
Consider your risk.
Additionally, buyers want to know the level of risk associated with earning this income. Is the company in an industry where competition is increasing? How long have the most profitable customers or clients been on board? How much debt does the company carry?
Assess the business’s potential.
What are the company’s long-term prospects? Is it a business with growth potential? Exists a limit? A marketable business allows you to receive more from it when you sell it.
Seek expert advice.
Generally, business brokers are willing to provide guidance for a nominal fee. Ultimately, they stand to gain a substantial amount of profit if you decide to use them in the future. Find a business broker with expertise in your industry and inquire as to what prospective buyers are seeking.
Prepare yourself and your organization for the future. Your unsellable business could be worth a substantial amount of money when you retire with some careful planning. Consult with an expert and structure your business and value-generating activities to make it a more marketable business.
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