How To Sell A Small Business By Owner

Selling your small business is an exciting and sometimes stressful time. You have built your business from the ground up, so it is natural that you would want to receive the highest value for it.

Many business owners choose to advertise their business in newspapers or online classified sites. While this can be effective, it can also be very costly.

Marketing your business professionally through media costs money, and you may end up getting few inquiries or buyers this way. Furthermore, with the increase of digital marketing, advertising online can be cost-effective while still reaching a large audience.

With the rise of social media and its use in everyday life, connecting a potential buyer with your small business can be done effectively through platforms like Facebook and Twitter. Using these free tools can further reduce advertising costs.

Choose a selling agent

how to sell a small business by owner

Once you have decided to sell your business, the next step is to find a selling agent. You can do this by posting an ad on TradeCorp, advertising in the TradeCorp newsletter, or through other business agent networks.

As part of your ad, include information about your business, why you are selling, your asking price, and how to contact you. Potential buyers will likely ask you questions about your business and their interest will depend on the answers.

It is important to choose an agent that has experience with small businesses like yours. An art dealer might not be the best choice for an agent if they do not know much about art restoration or buying and selling businesses of that nature.

Agents can either be independent or represent someone else who is interested in buying your business. It is up to you and the seller whether or not they choose an independent or representing agent.

Prepare the marketing plan

how to sell a small business by owner

The next step is to create a marketing plan. This includes developing a marketing budget, deciding on marketing channels, and creating a campaign.

Marketing channels include social media, print advertisements, and direct communication via phone calls and emails. The best small business sellers know how to use all of these to their advantage.

Social media is free for the most part, but it takes time to develop an audience so that potential buyers can find your business. Print ads cost money but can reach people outside of the area you live in which may help with sales.

Telephone calls and emails can be disconcerting but can also produce results. Talking with potential buyers about the business and why they would love it may entice them to buy!
As well, having multiple forms of advertising running at the same time helps promote the business.

Identify potential buyers

how to sell a small business by owner

The first step in selling your business is to identify potential buyers. Who would be interested in the type of business you’re selling?

There are a number of ways to do this. You can use social media, online advertising, direct marketing, and even word of mouth to introduce potential buyers to the business.

Social media is a free way to spread the word about your business and its sale. Creating a strong brand identity will help people recognize your business and find you when they are ready to buy.

Online advertising may cost some money, but it can also lead to more potential buyers. Using targeted ads on platforms like Facebook and Google allows you to target potential buyers based on specific interests or demographics.

Direct marketing is sending out flyers, emails, or letters directly to potential buyers announcing the sale of your business.

Collect information about the business

how to sell a small business by owner

Before you can sell your small business, you need to have information to share with potential buyers. This includes the history of the business, why you’re selling, what makes it valuable, and its future prospects.

The history of the business depends on how long it’s been in operation. If it’s been in operation for a few years, then potential buyers will want to know how it has performed financially.

If the business is new, then they will want to know about its growth and why it’s good investment. Both of these should be accompanied by financial information such as revenue and earnings.

Why you’re selling the business may be personal or professional-related. If it is personal, then potential buyers will want to know why so that they can better assess the value of the business.

If it is professional-related, then potential buyers will want to know about any industry changes or trends that may affect the value of the business.

Set a price

Once you have decided to sell your small business, the next step is to decide how to price it. Setting a fair price for your business takes some math and soul-searching, but it’s an important part of the selling process.

You need to figure out what you would consider a fair price based on how much money you have put into it, how much you enjoy running it, and what you think it is worth.

The market value of your business is a major factor in determining your asking price. If the market value has gone up significantly since you started your business, then you could ask for more when selling.

Another factor that influences asking price is whether or not you want to get what you feel the business is worth.

Document all assets

how to sell a small business by owner

One of the most important things you can do before you start marketing your business is to document all of the assets that are involved in the business.

This includes everything from financial records, invoices, contracts, and assets involved in the operation of the business. Also include employee information as well as investor information if there are any.

By doing this, prospective buyers will have all of the information they need to understand what they are buying and how much it is worth. This will help speed up the process of sale and ultimately get you paid what your business is worth.

In addition, having good quality information on hand will help with banking procedures for payment. Having all of the information organized and ready to go will save time during this stressful time for you.

Make sure to organize it by year so buyers can see progress over time and see how the business has grown.

Prepare financials and projections for buyers

how to sell a small business by owner

One of the most important things you can do as a business seller is to prepare your business for new ownership.

Doing so involves more than just listing the assets of your business and their prices. A willing buyer will also want to see how well the business performs financially.

Providing financials that are at least a year old and include all aspects of the business is a good place to start. These include income statements, balance sheets, and cash flow statements.

If you have been keeping track of important information in an organized manner, this should not be too hard to do!

Additionally, if there have been changes in the business that may impact future profitability, such as investing in new equipment or hiring new employees, let potential buyers know about this.
If you are unsure about how to do this, ask an accountant for help.

Host a website and social media profile

how to sell a small business by owner

A small business owner can set up a website and social media account to promote their business. Having an online presence is an essential part of marketing now.

Putting up a simple website with your business information, some pictures of your work, and links to your social media accounts will help people find you and keep track of you.

Having a website is also a good way to keep your name out there even after you’ve sold the business. A new owner can find all the information they need on the site, making it easy to take over the business.

Getting online can be tricky, however. It takes some skills and time to create and manage a successful website and social media profiles. You may want to consider hiring someone who has experience doing this for people who don’t have time or ability to do it themselves.

About The Author

Tiara Ogabang
Tiara Joan Ogabang is a talented content writer and marketing expert, currently working for the innovative company juice.ai. With a passion for writing and a keen eye for detail, Tiara has quickly become an integral part of the team, helping to drive engagement and build brand awareness through her creative and engaging content.
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