The most asked questions of business buyers and business sellers?
The questions are different, but my response is the same.
BUYER: “What are the things I should look for in a business to buy?”
SELLER: “What can help make my business more valuable now so sell in the future?”
My response:
- Operating margins above industry standards.
- Stable and motivated management team.
- Documented operating systems.
- A diversified customer base with no single customer representing more than 25% of overall revenue.
- Realistic growth strategy.
- Accurate and accessible financial records.
- Business is not solely reliant on the owner to generate revenue. The goodwill of the company is not tied directly to the owner.
- Business is not solely reliant on 1 or 2 vendors.
- The owner is paid a fair market wage for time.
- A high barrier to entry into the industry.
- Know your competition. What market share do you own?