subject: Preparing A Business For Sale [print this page] If you are a business owner and you are intending to sell your business then there are a couple of crucial elements that will require your full attention. Finding potential buyers and negotiating the correct value and sale price of your business.
You will of course probably have a valuation of your business already in mind, and this is an essential step in making your own decision on value and estimated sale potential at this early stage so that you are absolutely clear about the potential value you can expect to gain from the sale. At this stage, another important consideration is how you plan to deal with the sale when the time comes.
In determining the estimated value of your business there are several factors to consider during the process. Finance is obviously the big factor here, and you need to consider the historical, current and projected profits of the business and current cash flow. You will also need to consider the need for capital expenditure in the future.
There are also many external factors to your business sale you will need to make a point in being aware of, one such factor is the state of the economy. This is because what happens in the global financial markets has an effect on business through areas such as the level of interest rates, market demand and delivers an idea of the potential value of your business as you can check on how competitors or similar businesses are currently being valued. A negative economy can adversely affect the number of potential purchases are in the market place, and how many similar businesses are also looking for investment.
Another consideration to make are the intangibles of your business, areas such as intellectual property rights, the strength of your customer relations, the number of business assets, equipment, inventory, debts and the potential growth of your business that may affect any valuation.
by: Paul Myers.
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