Packaging the Sale of Your Business: Making Your Company Marketable in a Crowded Field
When you are packaging your business for sale, the uniqueness of your business makes it more attractive to acquirers. Having unique factors such as a defined brand identity, along with practical qualities. like a dedicated customer base, is hugely beneficial to prospective buyers. Here are some examples of features that make a business stand out from the rest: Brand name A good name can attract customers. If you're considering the sale of your established business, it may be too late for a name change, but that's no problem: it is the experience associated with the business name that counts. To improve or maintain your brand name when packaging your business, you can begin by articulating a clear purpose. Ask yourself some questions about what your business does, what the business stands for, what role the business plays in customers' lives, and who comprises the business's target audience. A well-defined brand profile will appeal to potential buyers eager to get involved in a unique business experience. Market Position Two related components make up your business's market position. The first is your business's actual market share of the industry relative to competitors. A business with a significant market share is attractive to potential acquirers, as they recognize that competition is reduced, the business can expand, and they can charge a higher price on goods and services. When packaging your business for sale, it's imperative to show that your business can remain profitable after you are gone. Carefully cutting costs or emphasizing long-term revenue generators such as contracts with customers or vendors can help strengthen your market position. These measures will assure potential acquirers that the business can continue to bring in profits after your departure. The second component of market position is the customer's perception of your business in relation to competitors. Ask yourself: What does your business offer that stands out to consumers? Even if your business is not at the top in market share, understanding what makes your business unique and appealing will definitely serve to capture the interest and imaginations of potential buyers. Customers It is critical to have a customer base in order to make your business appealing to potential buyers. As you begin to market your business for sale, try to keep your customer base strong, and even consider ways to expand it. Establish long-term relationships with your customers, create a customer profile and compile sales data. If you have sales records and an idea of your customer base, prospective buyers will be able to work with this data to identify growth opportunities. You can also diversify your customer base by introducing new business packaging techniques or products and services. Assets Physical assets such as inventory and equipment add to the value of your business. In some cases, assets can also include intangible items, such as the company's trademark and "goodwill." The more assets you can identify and record for both valuation and the ultimate due diligence stage of the selling process, the better the potential value of your business. As you consider packaging your business for sale, make sure you have up-to-date records, such as receipts and contracts, to demonstrate your inventory's value. Technology A unique technology is an especially useful feature to have if your company is to be acquired. Usually, companies interested in acquisition are looking for businesses that have a relatively strong, and perhaps patented, product or service. If your company is centered on a patented good or service, you should emphasize this fact when packaging your business. Even if you don't have an officially patented technology, you can consider highlighting a novel good or service that your business offers. Detailed documentation about how to make and market a unique product or service goes a long way toward attracting potential buyers. With these materials available, buyers will see that your business has a unique concept, but they will be convinced that they can easily take over the day-to-day operations of your business.