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Selling a Compressed Natural Gas Business
You've heard the naysayers - now isn't the time to sell a compressed natural gas business. But what they don't know is that many entrepreneurs see compressed natural gas businesses as a smart business investment.
Cutting corners never pays off, especially in the sale of a compressed natural gas business.
To sell a compressed natural gas business now, sellers need to make a strong case for buyers to purchase at or near the asking price.
Business Valuation
Professional appraisers can use three methods to determine the value ofa compressed natural gas business: The income method, the asset method and the market method. The income method determines value based on the amount of income the business is expected to generate. The asset method, on the other hand, is based on the value of tangible and non-tangible assets (e.g. brands and trademarks). In many sales, the most accurate valuation comes from the market method which determines value based on the recent sales of similar businesses. All three methods have multiple variations and it's not uncommon for appraisers to use a combination of the three to determine the value of your business. To drive up your sale price, position your compressed natural gas business by improving variables like assets, revenue and profitability during the years leading up to a sale.
Sale Preparation Timeframes
It's critical to properly plan for the sale ofa compressed natural gas business. For starters, the financials need to demonstrate a track record of profitability and growth. Next, the business will need to be documented in professional financial statements and manuals that facilitate the ownership transition. Since all of this takes time and effort, a compressed natural gas business can rarely be ready for the marketplace in less than six months. If you can afford to wait, we recommend investing a few years in improving your business's financial position before you put it on the market.
Tips for Working with A Business Broker
Business brokers are professional business sellers. Brokerage is particularly common in the compressed natural gas business-for-sale market, where aggressive selling strategies are the norm. However, your broker will still expect you to materially participate in the sale of your business. Successfully brokered sales are based on solid relationships between brokers and sellers as well as the strict execution of a common selling strategy.
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