Your business is likely one of your most valuable assets, but it is also an illiquid one. It will take time to unlock its value and convert it to cash or an asset that you can invest or spend.
Preparation and planning ahead are important, so that you are satisfied with the sale price and also to give you the time to find the right buyer.
It can take several years to “stage” your businesses properly, so that the financial statements reflect true and optimal results which will convert to the price a buyer is willing to pay. Positioning your business for maximum attractiveness to a buyer is also important. Minimizing risks such as key man/owner dependency are important and training and delegating key tasks to staff will reassure most buyers.
Once positioned, it often takes 1-2 years to find the right buyer, negotiate a mutually agreeable deal, complete due diligence and finally close the transaction. At this point, it is still often a requirement of most buyers that the owner remains with the business in some capacity for a couple more years.
Starting the process early, getting an assessment on company value and perceived risk well in advance of needing to transition are critical. Planning early, will allow you time to maximize the value unlocked from your business sale, to free your time and financial resources for the next phase in your life.