Here are some key questions to consider before you put your business on the market.
So, you’re ready to sell your business? You’ve nurtured it from the ground up, into a venture that’s now successful enough that it will appeal to others, who will ideally pay your full asking price. But if you think that alone is the criteria that make a business sale-ready, think again. There are many things to consider before you put your business on the market if you hope to reap the benefits of a successful sale.
Here are seven key questions to consider before you put your business on the market:
1. Are you ready to hand over the reins?
First and foremost, you must ask yourself if you are really ready to step away from your company and whether or not it’s at a point that it can survive without you. As many entrepreneurs can attest, sometimes they are the sole reason their business is a success. This is particularly true in cases where client relationships have been built over a number of years.
Still, the reality is, buyers are generally more attracted to companies that can thrive without the current owner’s continued involvement. If you’re still handling the day-to-day success that makes your business thrive, you may want to put your sale aspirations on hold, and begin mapping out an exit strategy that removes you from key roles. Only then will you truly be able to determine whether or not a future sale of your company can be successful.
2. Is your business currently thriving?
Buyers won’t bite based on past successes. If your business has already seen its heyday, don’t expect potential buyers to line up eager to buy it. This is why smart entrepreneurs often sell their businesses at the height of its success and popularity — they ride the wave to the top and then get out.
Ultimately, an informed buyer is going to want to verify that your company has been successful within the past 12 months and that it has a sustainable future. It’s up to you to prove that.
3. Do you have your affairs in order?
Potential buyers are going to want to see all kinds of information, likely spanning years. This includes tax returns and balance sheets. They’re going to want to see financial statements spanning entire 12-month periods in order to gauge seasonal fluctuations in revenue.
Potential buyers will also want to see licenses, permits, leases, customer and vendor contracts and anything else pertaining to business operations. Having your affairs in order also includes taking care of any outstanding debts or other legal issues that could potentially derail the sale of your business.
4. Have you consulted with all of the necessary experts to ready your business for sale?
When it comes to selling a business, don’t try to go at it alone. You’ll want to retain the advice of experts, including accountants, attorneys and business brokers that are seasoned in selling businesses in your particular (or at least a similar) field.
Doing so will ensure no important details, such as obtaining non-disclosure agreements from potential buyers, are overlooked.
5. Can you prove business profits?
Always remember that buyers are interested in profits over revenue when considering whether or not to purchase a business. The two are very different, and while revenues can look good on the surface, informed buyers will understand the difference between profit margin and revenue.
6. Have you conducted a thorough business valuation?
There are myriad factors to putting a dollar value on a business, including some you may not be familiar with. Like the previous consideration, this one comes down to expertise. A professional valuation will not only provide an accurate estimate of what your business is worth, but it will also better prepare you to vet potential buyers.
A proper valuation can also expose weaknesses that need to be addressed before you officially slap that for-sale sign on your business.
7. Are you prepared to answer questions and be transparent?
For a sale to be beneficial to both parties, you must be prepared to answer any and all questions that your potential buyer deems important. This means being honest about the pros and cons of your business. Don’t hide anything. Tell your buyers about your challenges in the business along with the successes.
If handled correctly, the sale of your business can be the perfect final chapter to your entrepreneurial journey. By addressing all of these points, you’ll increase the chances that both you and your buyer walk away from the deal satisfied and in the best position for future success.
With 20+ years of experience, Ymène has always enjoyed exploring natural environments and living among them. She grew up in Tunisia where she studied geology and environmental engineering. She obtained a master’s degree in environmental studies in Glasgow, Scotland. Her adventures took her to the US where she joined a doctoral program in soil science and conducted field-based research. She measured the components of the water balance and compared various cropping systems in Southeastern Pennsylvania. Post-doctoral research focused on hydrology and nutrient management on the Eastern Shore of Maryland, quantifying nutrient and sediment losses via runoff into the Chesapeake Bay. The source of these nutrients was the intensive poultry industry on the Delmarva Peninsula. This experience led her to the Canadian prairies where she explored beneficial agricultural management practices in nutrient management and water quality in Southeastern Saskatchewan. She then went on to consult for the oil and gas industry in Alberta and assessing soil and groundwater contamination with hydrocarbons and salinity. As an environmental expert, she worked on a project for the International Fund for Agricultural Development on sustainable agricultural practices in eastern Senegal. Currently based in Calgary, she works independently as an environmental soil scientist and hydrogeologist, sings in two Calgary choirs, and volunteers as an interpreter for the Calgary Catholic Immigration Society.
Alfredo is a Professional Agrologist with more than 20 years of experience in agriculture and the environment, primarily as a soil scientist. He has successfully managed contaminated site remediation, land reclamation and soil conservation projects throughout western Canada, on agricultural land, native prairie land as well as forested and peat land sites. Alfredo has conducted baseline soil surveys for pipeline construction and reclamation applications, as well as pre-development site assessments and soil monitoring programs as part of operating approvals. He has experience in environmental monitoring for construction of wellsites, as well as has provided field support to pipeline, powerline construction and monitoring teams. On the downstream side, Alfredo has participated in tank removal programs in Saskatchewan and Alberta as well as implemented risk management programs at decommissioned gas stations.
Klym manages air quality and energy-related projects including greenhouse gas verification, environmental approvals, air emission inventories and control studies, transportation and energy system studies, and environmental database and software development. Klym is a registered Professional Engineer in the province of Alberta and has his Certificate of Completion for the CSA GHG Verification Using ISO 14064 three-day training course. He has 20 years of experience working in both consulting and industry, providing project management and air quality-related services.
Nathan is an environmental planner with over fifteen years of experience conducting environmental assessments, planning, and regulatory permitting for public and private sector clients. He has an extensive technical background completing environmental assessments including wildlife, vegetation, and fisheries surveys, aquatic and terrestrial habitat classification and mapping, and environmental site assessments. Nathan has worked as an environmental planner and project manager coordinating multidisciplinary teams to conduct environmental assessments and to achieve regulatory permits and approvals.
Carol is a native Calgarian and professional biologist who has spent time tromping around the foothills of Alberta riding horses, watching birds, camping and backpacking. Her 15 years + of experience has led her to be skilled at understanding human-wildlife interactions, environmental impacts, habitat restoration and wildlife management. Her wish is to combine her skills in ecology, biodiversity, species at risk and collaboration to solve environmental and sustainability problems. She has an in-depth understanding of natural resource policy and regulatory frameworks in Western Canada. She has coordinated pre-disturbance field programs and completed many environmental audits and inspections for oil and gas facilities and pipelines.
Aimée has 10 years of experience in the environmental field, 6 years as a practicing professional. She is familiar with applications under the Water Act for end pit lakes, pit-to-pit dewatering, or dewatering offsite. She has advised managers and clients on regulatory requirements associated with both Water Act applications and Code of Practices. Part of her work has included completing soil and vegetation assessments where rare plants and species at risk are always a consideration. She has participated in field assessments and coordinated biological field programs including: vegetation, ecological land classification, wetland, wildlife, species at risk, soil classification and monitoring, as well as coordinated and prepared environmental approvals and permits required for projects including Federal, Provincial, and Municipal permits; she has also been involved in First Nation Consultations. In addition, she has worked on environmental impact assessments, Phase 1 and 2 environmental site assessments, detailed site assessments, groundwater monitoring, remediation and reclamation certificate applications.
Marcus is an ecologist and lead modeller at Beckingham with a focus on ecological interpretive and predictive modelling, data management and processing frameworks, statistical analysis, and application development. Marcus has 15 years of diverse applied ecology work experience in China, Europe, and central Canada with strong expertise in designing and utilizing models to evaluate and facilitate forest management, environmental site assessment, and predictive carbon sequestration.
Mayson has extensive experience completing oil and gas projects across Western Canada and in the United States. He specializes in using risk assessment approaches to reduce or eliminate remediation requirements to achieve regulatory closure of contaminated sites.
Roger has over 25 years of environmental consulting experience and has expertise in numerous areas of environmental consulting. These include contaminated site assessment and remediation (oilfield and industrial sites), environmental management systems auditing, design and implementation, environmental compliance auditing (AER and AEP regulated operations) and environmental due diligence assessments (oilfield and commercial/industrial). Roger’s most valuable attributes include his ability to see practical, cost-effective solutions to complex problems and to effectively communicate nuanced complex concepts and interpretations in ways people from all disciplines and backgrounds can easily understand.
As a GIS/Remote Sensing Specialist with a background in ecology and forestry, Zoran has gained extensive experience using remote sensing and GIS analysis to examine the effects of anthropogenic disturbances on landscapes, hydrological resources (wetlands and water crossings), vegetation, and wildlife. For over 17 years, he has led multidisciplinary teams in developing and designing spatial analysis processes for the oil and gas, mining, utilities and pipeline industries. Among many national and international projects to which he has contributed, a key highlight of Zoran’s experience is leading the world’s largest landscape area analysis of anthropogenic changes across Quebec, Manitoba, Saskatchewan, BC and Alberta. The results gathered from the landscape change analysis were used in habitat modeling, habitat fragmentation and loss analysis, TLU mapping, land use planning, EIA/BIA – cumulative effects assessments, and reviews, pipeline environmental risk assessments, pipeline and road alignment sheets, and wetland mapping. He also developed and executed a methodology for the Avian Hazard Mapping and Risk Assessment for the Oil Sands Region and worked in a partnership with World Resource Institute and Global Forest Watch to map intact areas in boreal forests.
Carolyn’s focus is on leading engineers and scientists through challenging, complex, and remote environmental assignments. Her unique, natural curiosity to understand her teams and clients gives her the knowledge and tools to successfully guide multi-disciplinary and cross-cultural teams to successful project completion. Carolyn also works as an environmental specialist, reviewing changing environmental policies, acts, and regulations, to identify and provide strategic advice to business units impacted by the changes.
Olivia is a seasoned field technician with particular expertise in soil and groundwater assessment. She has an advanced diploma in Marine Geomatics from the Centre of Geographic Sciences and a Bachelor of Community Design with a minor in Environmental Planning from Dalhousie University.