There are many strategies you can use to sell your company for the highest price. The first part of this blog covered strategies in things such as accounting, employees, office culture and more. This blog has six more strategies for you. So what are they?
Predictable Cash Flow
If you want to sell your company for the highest price possible, think of revenue and cash flow as the starting point for any buyer. A steady stream of predictable, recurring revenue is ideal. It is no secret that buyers will pay far more for companies with projected cash flow.
â€œUncertainty with respect to your cash flow makes it hard to invest in longer term needs, and it also causes major stress on the owner as she or he struggles to keep things in balance.â€ â€“Â Inc
Already utilized setup systems that efficiently help scale without needing more people are very beneficial when it comes to selling your company for the highest price. Efficiency is key because it saves potential buyers more money down the road.
â€œScalableÂ is the term used in software engineering to describe software systems that can accommodate growth.â€ â€“Â Medium
Efficient setup systems make it easier to add new customers. In turn, the easier you can add new customers, the more attractive your company will be to a prospective buyer.Â
Goodwill Equals Good Price
Name recognition, customer awareness, and good PR go a long way when attracting someone willing to pay the highest price for your company. Launch a good PR campaign a year out from when the sale process begins to boost goodwill within the marketplace. High Net Promoter Score Customer ratings also help drive increased purchase prices.
Put simply, the more the public likes your company, the more likely buyers will pay a high price for it.
Know Your Value
Knowledge is power! To sell your company for the highest price possible, know how much itâ€™s worth. Get several independent valuations by reputable firms so that you have a rough idea of what your company might feasibly sell for.
Not only that, but consider additional parts of the company that valuators may not see. Consider what actions you might be able to take ahead of time to increase your companyâ€™s value in 12 months. Small acquisitions and drastic overhead cuts are a great place to start.
Buyers donâ€™t like surprises, so operate above the board. Be prepared to show value that they might not see and explain information they might question.
Be open about any issues theyâ€™re sure to discover anyway. A buyer is much more likely to pay more if youâ€™re open about issues rather than if you try to hide them and they eventually discover them anyway. You donâ€™t want the buyer to see you as dishonest.
Documented growth shows the companyâ€™s future is stable, if not predictable. Stable futures definitely increase the likelihood of selling your company for the highest price.
Show buyers that your company has a ton of upside! Consider acquisition opportunities, additional product lines, untapped markets, sales funnel projections, or PR thatâ€™s about to come. Basically, anything you can share about the companyâ€™s growth potential will add value.
Selling a company is difficult and selling it for as much as you want (or more!) is even harder. If the time comes for you to sell your company, these tips are sure to help. Theyâ€™ve worked for tons of leaders before, so why canâ€™t they work for you? Give them a try!
Do you have any other tips that werenâ€™t covered in this blog or the last? Let us know in the comments below!
If you have questions or would like more information, Iâ€™d be happy to help. PleaseÂ send an email, and my team will get in touch with you!
Editorâ€™s Note: This post was originally published in December 2017 and has been edited for accuracy and comprehensiveness.