The reasons to sell a small business range from personal to financial. Problem is – when it comes to the business you’ve built with your own blood, sweat and tears, the thought of selling tends to generate very strong emotions. That’s why many owners tend to ignore, or outright deny, the signs it’s time to sell until it’s too late. Or, worse, they wait until they’re forced to sell.
You’ve Run Out Of Ideas – Or The Money – To Grow Your Market Share.
When you first opened your doors, you were filled with ideas for growing your new business. But, as the years rolled by, your market share has started to stagnate. Or, worse, bigger competitors are squeezing you out. You don’t have the money in your budget to “buy” a bigger market share through more expensive advertising. And you certainly can’t drop your prices any lower in order to compete. If any of this rings true for you, it’s a strong reason to develop your exit plan before your competitors put you out of business.
You Can’t Afford To Keep Up With Technological Advances.
To be competitive, you have to stay current with the newest technology and train your staff to use it. If you can’t afford to buy it, it’s a good reason to consider selling your business to someone who can. Harsh but true. These days, technology becomes obsolete at a mind-blowing speed. And it’s not going to slow down any time soon. If you are unable to keep up with technology this year, what about next year and the year after that? Think about it. And then think about selling your business before it falls further behind the times.
Health Issues Are Getting Harder To Ignore.
Certain health issues are creeping up and they may prove to become chronic over time. It should go without saying – nothing is more important than your health. Whenever health becomes a consideration, it’s time to sell your business and take care of yourself.
Family Members Aren’t Willing Or Able To Take Over Your Business.
When retirement looms on the horizon, it’s time to think about who’s going to take over the helm. Small business owners who employ relatives often assume their company will stay in the family when they retire. But, in reality, only 30% of family businesses survive into the second generation and only 12% operate into the third generation. It’s a good idea to keep these numbers in mind before you find yourself a year or two from retirement without a viable exit plan. It’s better to be selling your business to an outsider – earlier than you planned – than put off your retirement indefinitely because no one in the family can or wants to step up.
Remember – having a strategic Exit Plan is just as important as having a 5-Year Plan when you first launch a business. The trick is to recognize when it’s time to pass the baton to a new owner.