Niche Exit Planning Tactics
Selling a Wood Pellets Business
A lot can go wrong during the sale of a wood pellets business these days. More than ever before, it's important for sellers to know the tactics and techniques that are being used to maximize sales price and achieve desired sale outcomes.
The business-for-sale market is just as frustrating for buyers as it is for sellers these days. Although there are plenty of entrepreneurs who want to buy a wood pellets business, capital restrictions are holding them back.
Success is a factor of preparation, execution and a keen eye for the market. As a business seller, you need to go into the process with the mental goal of presenting your business in the best possible light.
Current Market Conditions
At first glance, today's market would seem to be a hostile place for wood pellets business sellers. 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. The simple truth is that the economy shouldn't dictate whether or not now is the right time to sell a wood pellets business. Your individual circumstances and personal goals are more influential factors in determining when it's time to put your business on the market.
Valuation Methods
The methods for valuing a wood pellets business vary according to your business model and circumstances. However, there are generally three valuation methods appraisers use to determine your company's worth. 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.
Handling Unexpected Outcomes
Every business seller dreams of a fast sale and a fat payday. However, no one told the marketplace about your expectations. The outcome of your sale will be determined by market forces - not by your personal circumstances or desires. Surprises are inevitable, so to minimize the disappointment you will need to prioritize the outcomes you require from the sale. If buyers don't seem to be willing to meet your expectations, consult with your broker to modify your strategy and market approach.
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