“One of the most common questions I get asked by Entrepreneurs is how much is my business worth?”
When we begin working together the first step in the process is to build the strategy and in turn, look at the exit plan. Sometimes that exit might be 5 years, 10 or 15 years away. Nevertheless, we always build in an idea of what the exit (at that moment in time) is most likely to be.
Then comes the question; “how much is it worth Adrian?”
The answer is more about who you’re going to sell it to because that has the most significant impact on your sale price. In most cases, this will be a competitor; somebody who’s already in your market and would dearly value your customer base and your market share.
I’ve been working with a home improvement company for the past 5 years. From day one, the owner and I created a small list of potential buyers for his exit in around 10 years time. We’ve got one prime and five secondary buyers in mind, all competitors.
The prime buyer is the best fit; the company shares the same target market, the same quality and range of products, a similar culture and brand values, and doesn’t operate in the areas as my client. We also know they aren’t afraid of acquisitions.
Without breaching confidentiality over the last 5 years we’ve made sure the way we’ve grown the business has kept close to this end game and our intended prime purchaser.
Who would be your prime buyer?
Take 10 minutes today to think about your exit plan:
- When would you like to exit?
- What would be your preferred exit route?
- If you’re going to sell, who would be in your target buyer list?
- How much do you need to sell for?
- How much is your business worth now?
If you’d like to get an online valuation click here – Free Business Valuation
Until next week…have a great weekend