5 Mistakes To Avoid When Selling A Business In Orlando
When selling a business in the Orlando and Central Florida area there are some obvious items for business sellers to put into action, such as updating their financials. At the same time hiring a well-known business broker in Orlando with a track record and great reviews is always a plus. Even with those advantages however, there are many business opportunities that are marketed for sale throughout the state of Florida that do not get sold. This might leave yourself asking, “how can I sell my business in Orlando without making any major mistakes?” We want to display some of these mistakes in hopes that business sellers can avoid them in the near future. Below are some of the major mistakes potential business sellers can avoid when selling a business in the Orlando area.
1) Not Knowing What Brings Value To Your Business.
When buyers are looking for businesses for sale in the Orlando area there are key factors that buyers are searching for.
These factors include:
a) clear financials detailing all of the expenses, costs and profits
b) a sales portal that clearly shows how the business finds, receives and obtains customers
c) contracts, elite customers, locations, copyrights or anything else that puts the business on top of their competitors
Business owners should work hard to cater to these desires and position their businesses to show why their business should be purchased. Some business sellers in Orlando place too high of a value on items that are not high selling points for buyers. For example, many business owners place high values on their engagement on social media boasting they have thousands of followers. While large social media followings can be a benefit, buyers only see it as beneficial if the social media shows a direct correlation to great earnings. Another example is putting too much value in a brand name, a website, or a trademark. Often times owners are quick to point out the value of their brand or their website name, however when buyers are looking to buy a business the branding is only as valuable as the earnings of the business and its customer base. Without good earnings and good customers, branding and social media will not hold much value for buyers. Sellers need to focus on where buyers prioritize their value.
2) Not Taking Any Steps To Help The Transfer
There are steps that business owners should take when they are about to sell a business. The business should be organized and processes and procedures should be in place. All of the employees should have clearly defined roles in the business and buyers should be able to see a clear path for them to fit in. Not all business owners have that vision unfortunately. One example is when business owners do not want to leave enough time for a familiarization and training period after a sale. Other business owners have mentioned that they do not have a current lease in place for their business and just pay a landlord month to month and have no idea if a landlord is even open to hosting a long-term tenant in that space. There are some business owners that do not have any agreements with any of their vendors or suppliers and if they have agreements they have not inquired as to whether or not a new owner could work under those same agreements. The bottom line is that business owners need to make sure that everything can fall into place for a new owner and that the new owner has all of the tools necessary to operate the business after the purchase.
3) Having An Unconvincing Reason For Selling The Business
There are times when selling a business is unavoidable. Business owners have health issues, their spouse might have a job transfer that requires them to leave or even a divorce can cause a business to go on the market for sale. As unfortunately as the personal situations for the sellers may be, these are good reasons for an owner wanting to sell their business. Retirement is always the best answer, but that is not always a valid reason for a seller to give. Some business owners are simply burnt out and are looking to do something different. Business buyers typically ask business owners why their business is for sale so a business seller needs to be prepared to answer this question. No matter what the answer is, business sellers need to address two important items in their answer:
a) why the seller will not need to come back into the business and compete with the buyer (mentioning other work options such as a job, a new venture, or relocating out of the area are always a good idea)
b) the seller’s assurance that the business is still going strong and the seller is not leaving because the business is weak and cannot recover.
Buyers want to feel comfortable with these answers. They do not want to feel like a seller may come back and compete with them in the near future and they want to feel as though they are taking over a thriving business with lots of potential. Telling a buyer that a business is up for sale simply to see if potential purchase offers are attractive is not a great reason to mention why a business is for sale.
4) Needing A Quick Sale
Sometimes needing a quick sale is unavoidable. Often times the reason for sale is a serious health issue, but the reality is that needing a needing a quick sale can make a business owner vulnerable in the sale of their business. Often it leads to mistakes or leaving money on the table. For example, there was a business broker in our office that met with an owner that wanted to sell a large restaurant and bar. However, their lease was up in one month and the owner had no plans on renewing their lease so they needed a quick sale. Unfortunately, one month is not a great deal of time to sell a business. The process of transferring a lease to a new owner by itself before closing could take a few weeks. Realistically that seller would have been better off contacting a business broker in Orlando 8 to 10 months earlier. Some quick sales are unavoidable, but if you want to sell a business for a good price, the more time you have available the better.
5) Picking The Wrong Ways To Market The Business
If you’re wondering how can I sell my business in Orlando and add value there are right and wrong ways to market a business for sale in the Central Florida area. When selling a business in Orlando it is important to remember that selling a business is not the same as selling a house or a piece of property. Confidentiality is typically a key factor. For example, putting a “For Sale” sign in the front window of a business does not help build the perception of value in a business. In fact, it may send a signal to your customers and competitors that the business is in trouble or that a new owner might be coming into the picture soon and change how business is done. Yet, business owners tend to take this action or go public about wanting to sell their company all the time. If this occurs, the publicity often tends to be unfavorable towards the business because rumors rarely include the whole story, so the story becomes filled with questions and concerns. It is for those reasons among others that keeping a potential sale confidential from employees, customers and the general public can be a benefit both for the buyer and the seller. Finding a talented business broker in Orlando or Central Florida area, one with great reviews and a great track record often times is one of the best ways to market and help an owner sell their business.
For more information on business brokers in the Orlando area or if you are looking to sell your business in the Greater Orlando or Central Florida area call Crowne Atlantic Properties at 407-478-4101 or check out our website at www.crowneatlantic.com.
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