As we enter the middle of the year, we still do not see a true end in sight for COVID-19. It can be frustrating – not knowing how much longer plans for going to concerts, vacations, and other treasured activities may have to remain on hold. Thankfully, we are here to tell you that the plan to sell your business does not need to be one of those. When you have a solid business (one that is likely coveted by potential buyers), it is always going to be in high demand. As the economy has taken a turn, the distressed market has created new opportunities for those looking to buy or sell. In other words, there seems to be no better time than the present.
The Small Business Administration (SBA) has recently stated that it is going to pay the first six months of loan payments for those closed before September 27, 2020. On top of landlords being more flexible about lease terminations and payments, any losses you may have experienced during the COVID-19 pandemic does not have to halt your plans to sell your business. The economy is supporting entrepreneurs during this time.
Where do I start?
As an upcoming seller, your role is to prepare your business for the sale. This is going to look like it would normally, with a few additional caveats. The thing is, your business likely had to close and/or saw a reduction in sales. How do you value a business that took an unprecedented hit? The key is to measure projections. Did you get creative and find new revenue streams? How did switching to delivery or curbside pickup expand your consumer reach? As your business reopens, will you keep these convenient accommodations for customers who cannot visit your office or storefront?
Buyers are out there so it’s important to know how to market your business based on its status. People looking to purchase a business right now are potentially looking for one of three different types of businesses.
· Stable – Stable businesses have been in the community a long time and they have strong roots, loyal clientele, etc. The business’s name is well respected. This can be very attractive to potential buyers who want to capitalize on the years of hard work that you have already put into this business.
· Thriving – Thriving businesses have learned to capitalize on creativity and are not afraid to try new things to keep the business moving forward. These businesses may have recently reimagined their business and found ingenuity to be the way to generate new revenue. The future is bright for thriving businesses and potential buyers will see this and want to keep it moving in the direction of success.
· Distressed – Businesses that are struggling or in distress have their own audience of potential buyers who see the opportunity for rebranding or who may use the foundation you’ve established and find a way to turn it around. Some buyers will thrive in the face of this kind of challenge and may want to take what you’ve done and add their vision to create something fresh.