Exit Planning Tips
Selling a Hobbies Business
Think hobbies business sales have dwindled to a standstill? Think again. There aren't any guarantees, but if you adhere to fundamental business sale concepts, you can likely get a good price for your business.
You won't find any magic formulas for selling a hobbies business, especially while the market is struggling to overcome the perceptions created by a down economy.
Success is a factor of preparation, execution and a keen eye for the market. Since your future goals depend on the outcome of your sale, you'll need to have your head in the game from Day One.
Tips for Working with A Business Broker
Many sellers employ business brokers to manage the details and direction of their sale. Brokers routinely work with hobbies business owners to achieve desired outcomes and deliver a successful sale as quickly as possible. However, your broker will still expect you to materially participate in the sale of your business. Establish clear lines of communication with your broker and respond quickly to requests from prospective buyers. You should also assist your broker in listing your hobbies business on BizBuySell.com and other online business-for-sale sites.
Business Valuation
Professional appraisers can use three methods to determine the value ofa hobbies business: The income method, the asset method and the market method. Appraisals based on the asset method gauge value as a factor of the company's real property and non-tangible assets; appraisals based on the income method consider the business's anticipated revenue. In many sales, the most accurate valuation comes from the market method which determines value based on the recent sales of similar businesses. A good appraiser will often use multiple valuation methods to arrive at a reasonable estimate. Sellers should take note of the fact that all three valuation methods reward businesses that takes steps to increase assets and income.
Current Market Conditions
No one plans to sell a hobbies business in a down economy. So far, government intervention and promises that the economy is slowly recovering haven't been enough to alleviate many entrepreneur's fears. However, many business sellers don't realize that a full economic rebound can have devastating consequences, particularly if sellers who have waited to list their businesses suddenly create a glut in the business-for-sale marketplace. So what's our point? The economy isn't the most important factor in the sale of your business. Instead, you should be focusing on making your hobbies business as attractive as possible so to buyers right now.
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