Selling Your Business??how Do You Know When To Sell Your...

Author: Fernando Simo

Author: Fernando Simo

Article Source: MiNeeds.com, where consumers get competitive bids from Real Estate Agents/Realtors. Read reviews, compare offers & save. Its free!

Article Link: http://www.mineeds.com/Orlando/Transworld-Business-Brokers/Articles/Selling-your-BusinessHOW-DO-YOU-KNOW-WHEN-TO-SELL-YOUR-BUSINESS

Tags: Selling and Buying a Business in Central Florida

During the week, I had a discussion with a very talented individual whose job is to help businesses get well financially through leadership development. He asked for my opinion regarding valuation and exit strategies. The essence of his question dealt with a topic in the mind of many-a-business: when can I sell my business in order to get the most value?

Now, I know that many of my colleagues may have their own answer to this question. However, I gave him a very simple answer: Treat your business as if you were either buying or selling stock. Now, lets not count those businesses which must sell for personal reasons, such as health problems; relocation requirements; moral or ethical issues; conflicts with partners or the BIG ONE; cash flow. Those businesses, unfortunately, must sell at whatever price the market demands based on current business conditions and profitability. No, I am talking about those businesses which began with an expectation/plan.

People buy stock because they expect a certain level of either growth (accumulation of equity) or earnings (Dividends). Likewise, entrepreneurs enter into business opportunities after the development of financial forecast projecting the sales and earnings growth of the entity, given a certain Internal Rate of Return (IRR) and in some cases, after a clear definition of an exit strategy. So, they buy with an understanding of the risks/rewards associated with the opportunity. So when should they sell??

Just like stock, these businesses should sell when the results of operations are significantly less than or more than expectations. Depending on many factors, significant growth normally means a new concept/industry and, guess what?? major corporations normally look favorably to buying into and diversifying into growth markets. Sell it!! If the results are significantly less than expected, sell it!! Isnt that what you would do if the stock falls by a specified percent? If you do not, chances are that you will lose more in the long run.

So, treat the sale of your business as you would treat the sale of stock. Yes, I know, too simplistic, but true.

Should you want to know more about buying or selling a business in Central Florida, please contact Fernando Simo at 407-361-8886, email me at fsimo@tworld.com or please visit my webpage at www.bizbuyorsellflorida.com .

Was the Article Useful?

I hope you enjoyed the article! Please rate it at the following link, your feedback is highly appreciated:

Selling Your Business??HOW DO YOU KNOW WHEN TO SELL YOUR...

by: MiNeeds10

POST COMMENT

The Recession Impact On The Business Brokerage Industry The Value Of Good Financials--don't Cheat! So Infatuated With Burberry Handbags-handbagseshop Solid Modeling Vs Surface Modeling Find Discount Marc Jacobs Handbags-handbagseshop Daily Announces Gen 2 Metal Mount Rfid Tags For Harsh Environment Find Discount Fendi Handbags-handbagseshop Businesses With Established Credit Profiles Have More Credit Options Why A Business Line Of Credit Is Important For Every Business Using Business Credit Cards Effectively The Freedom Business All You Wanted To Know About A Business Litigation Attorney The Business Guide to Staying Trendy