It may not seem like the best time to sell a business right now due to the pandemic, but there is more to think about than the overall economy. As we’ve seen from the Financial Crisis of 2007-08 and now the COVID-19 recession, we can’t control what will happen from one day to the next. While you certainly want to consider the economic climate, there are other factors to pay attention to as well.
American Business Acquisitions (ABA) is a premier Chicago business broker that works with people who want to buy or sell businesses. After working with many clients over the years, we’ve come to find that these five signs are most telling as to when to sell your company.
1. You feel like you’ve peaked.
Does it seem like you’ve reached the top of the mountain? There may be growth within your industry, but if you don’t have the time, resources or energy to go after them, it may be time to consider or implement an exit strategy and take advantage of being at the top of your game, which is the best time to sell a business.
You can sell your Chicagoland business to a larger company or a group of individual buyers who have the resources to take on these new growth opportunities. You’ll feel good knowing that your business can continue growing and build on the momentum established during your ownership.
2. Your Chicago business has increased in value.
If you were cautious about your spending and operations, there’s a good chance that your business has increased in value. If this is the case, there’s probably other entrepreneurs who would be interested in buying it from you. This is especially true if your company fills a particular niche. A business acquisition or merger would allow a larger company to expand their products and services to this new clientele. Why not cash in on your hard work?
3. You’re getting ready to retire.
As you move into retirement, there are many practical benefits to selling your company. You can earn a significant nest egg from the sale that will allow you to achieve a comfortable retirement. Sure, you can live off the income from the business, but you’ll still have a lot of responsibility. For most business owners, it’s best to sell their business when they want to sell rather than when they have to sell so they can begin planning for the next chapter in life at an opportune time.
4. Your net worth is tied up in your Chicago business.
If you’re like many business owners, a large portion of your net worth is tied up in your business. At one point, this may have been okay, but now you may be looking to convert this equity into liquid assets. This can be an especially smart move if you’re nearing retirement and want to convert your business wealth into personal wealth.
5. You’ve lost your passion.
Some business owners experience a roller coaster of emotions when it comes to selling their business. We can understand this, as your business was probably your “baby” at one point. But if you’ve lost your passion, are ready for change or simply don’t enjoy taking care of operations any longer, it’s okay to happily pass the torch. You can use your nest egg to pursue other ventures – even if it’s sitting on the beach all winter.
It’s normal to feel conflicted about selling your business. Speaking with a business broker in Chicago can help you sort through your options and make the best decision based on short term plans and future goals. Contact American Business Acquisitions today for a free consultation.