As an entrepreneur, it is a natural progression to contemplate selling your business online. While the reasons can vary – from purely personal ones to cashing in to move on to other ventures or even consider an early retirement -, the steps involved in the process are rather a staple. Knowing them not only helps you in navigating them successfully, but it also increases your chances of getting that proverbial pot of gold, at the end of the rainbow. So, to nudge you in the right direction, here is a handy guide to answer all vital aspects of the question – how to sell my business online?
Business Housekeeping
Housekeeping is a term not often associated with businesses. But it is as crucial a step as any. In the business context, housekeeping involves organizing your data and performance metrics, something that is likely to be the first thing potential buyers ask for. Furthermore, it is equally important for you to assess the health of your own business and allocate a selling price accordingly. So, under business housekeeping, you should:
- Organize all financial accounts and legal documents such as tax and audit reports, regulatory certificates, sales and revenue figures, supplier and vendor details, payments due, wages paid, future projections, et al
- Gather all relevant operational metrics such as total online traffic, cart to-sales conversion, average customer ratings, inventory held, percentage of returns, replacements, order cancellations, and so on.
Experts suggest: Don’t just gather this information for the sake of, analysing it from a buyer’s perspective. While you ask, ‘how to sell my business online?’, it is equally valuable to ponder ‘what makes my business attractive to buyers?’. A financially sound business plan, low debts, loyal customer base resulting in a steady revenue stream are just some of the appealing factors. If it isn’t the case already, then it may be worth your while to get it into the right shape before actually selling it.
Business Valuation
The next step should be to put a price tag on your business. While it sounds very transactional, surely that is not the case. There are several intangible aspects that can boost or dampen your business valuation. Not to forget, it is natural for emotions to get involved as well. Ask any seasoned seller and they will tell you; it is important to cast emotions aside and be pragmatic in this process. Your business valuation should be a direct reflection of your annual earnings, future potential, worth in the market, and the customer base that you have garnered. If you are selling your business online for the first time, it may be prudent to seek professional assistance in this step. There are several specialist firms and acquirers, who can run this process for you to get you a fair price tag.
Business Listing
Having cleaned your operations and established a selling price, you should now explore the options at your disposal to list your business and attract potential buyers. Here, too, there is the option of seeking out professional experts in the form of brokers and acquirers to help you navigate the waters. While acquirers provide a more seamless and inexpensive service, brokers may help you reach out to a wider pool of buyers, albeit at a fixed cost of a percentage of the sale amount in commission. You, also, have the option of selling directly via your own professional or social network. However, first-time sellers are advised to avoid flying solo as there is a high chance of getting short-changed in the process. Not to mention, the legal and contractual processes involved can take their toll on your resources if you are not well versed with how it is done.
Next Steps
Once you have locked in on a buyer, the next steps include conducting negotiations. After all, even if they are trying to get the best bargain and it is not uncommon to have differences in opinions regarding the asking price. Be patient. Let this phase run its course. It is easy to get flummoxed and give in, thereby resulting in getting a lower amount than you deserve. It is, equally, easy to become stubborn and lose out on the opportunity to encash. Have a well-defined negotiation strategy with fall-back options. In the valuation stage itself, establish a walk-away price along with your asking price. When you sell your business online, it is likely that your eventual sale will happen somewhere in between these two figures. Simply put, your asking price is what would be ideal and your walk-away price is something that you will not consider getting lower than.
In Summation
If you would like to know more about how to sell business online then here is some more professional guidance for you to avail of.
