Whether you’ve newly purchased or have a well-established operation, preparing your Management Rights business for sale is an important scenario to consider in the back of your mind.
It’s highly likely as a business owner, you will look to sell at some stage, therefore being informed about what you may need to prepare is an important step in the process.
Preparing your Management Rights business for sale is not something that can be done overnight. It is a process that you need to be consciously thinking about from the very beginning when you have first purchased your business, and will often need to be re-evaluated.
What Do I Need to Prepare?
Selling your Management Rights business should be no different to selling your house.
Ensure that the business is presentable, records are filed orderly, and where appropriate, have various functions within your business systemised and thoroughly documented.
In order to instill confidence in your prospective buyer, there are three key areas of your business that you should consider:
1. Presentation
As with selling your house, presentation is key!
We all know that first impressions really do count – this is no different when it comes to selling your business.
Take the time to clean up your office and residence. Remember, a clean and tidy office gives the impression that the business runs smoothly.
Also, depending on the physical state of the complex, it may be worth considering what extras can be done to increase its appeal. Minor adjustments, such as a change of lighting or re-painting the interior to provide a fresh look, can potentially generate great results.
It is important to note that you can have your business/residence looking very presentable for a very minimal and affordable cost. If you can take the time to make any small adjustments, do so as this could be a key deciding factor.
2. Profit & Loss for Sale Report
When defining your sale price, knowing what your business is worth is an important and vital consideration.
A Profit & Loss for Sale report prepared by a recognised accountant is a great tool to help you understand what your business is worth, as well as assist you in making informed decisions.
The benefit of having a Profit & Loss report prepared will instill confidence with the purchaser, as it reflects that the net operating profit is accurate.
Having a detailed Profit & Loss report also helps you have the confidence in knowing the sale price you have advertised is a true reflection of your business.
Additionally, by not having a P&L report prepared, you may run the risk of your business being presented as overpriced – resulting in it staying on the market longer and becoming “stale” to potential buyers.
3. Documentation
One of the greatest obstacles when selling a business is the uncertainty surrounding the prospective purchaser.
To help make the buyer feel at ease, it is important you have all the relevant documentation readily available – being as open and transparent as possible throughout the process.
A well-systemised/documented business can help calm any fear or uncertainty that the purchaser may have.
Once the potential buyer feels comfortable with the business, you may find that price does not really becoming an on-going issue.
Additionally, by having the appropriate systems and procedures already in place, you can help smooth the transition for the new incoming Manager.
In choosing to be mindful of your businesses future sale, preparing early and having your business ready for sale, you may see a greater return on investment and further benefits – such as increasing your saleability and a much strong sale price.
For More Information
For more information on preparing your Management Rights business for sale, please contact Smiljan Jankovic on (07) 3002 2699 or via email: smiljanj@archergowland.com.au
