One of the biggest considerations for a buyer of your business is: ‘If I owned this business, what will I have to do?”. That might sound obvious, but in practice, it’s one of the least serviced concerns of a buyer. When you flick through a Sales Memorandum often you’ll see some mention of what the owner does in a business, but usually, it’s nothing more than the hours involved.
If you consider the importance of it though, the question;‘how will my life change through buying this business’, it seems crazy that it’s overlooked at all!
So, to bring in the end of the year, here are two very quick and easy tips to make it easier for you to answer that question adequately.
1. Keep records of YOUR working hours.
Keep a journal of your working hours and what you do. After a couple of weeks, write yourself up a timesheet! It might sound like a silly exercise, but for the most part, it doesn’t take too much time, and it can do a lot to clarify to a buyer what to expect. If you’re worried that you’re putting in too much time, and that it might deter buyers, then consider this: It is likely that your workload will be seen by buyers through their Due Diligence process anyway. On the plus side, conducting the exercise might present you with some possibilities to hand over some of your jobs to your employees. You might find some stuff in your workload that you simply don’t need to do. This in effect will make your ‘job’ more attractive to potential buyers.
2. Write a job description of YOUR job.
Based on your journal, write yourself a job description. Keep it succinct and try to paint a picture of what you do in the day to day running of the business. This is just as important as the timesheet. For a buyer, it will give them a feel for what to expect. It uncovers the unknown… and that is a very valuable asset in any business sale.
… So what’s the point of all of this?
Selling a business is rather like selling anything- it’s all about overcoming barriers to purchase. With a business sale though, you’re talking about a LOT of money and a very big life change which leads to uncertainty in your buyers. By giving some sort of formal answer to the question ‘What will I have to do’, you are actively overcoming an uncertainty that would otherwise be a great, big, fat question mark in the mind of a buyer.
In short, answering this question makes your business more sellable… Which is what this blog is all about!
If you would like help in preparing your business for sale or taking it to the market, we’d love to talk to you. To get started Call us on (02) 9817 3331 or fill in an enquiry form by clicking here.
Also, if you have any success with this process we’d love to hear from you, so let us know by leaving a comment below!
By Zoran Sarabaca
Principal, Xcllusive Business Sales
Sell your business with Certainty
PS. By the way… When should you start? Even if you’re not selling yet, try the job journal exercise now. As we mentioned earlier, you might uncover some jobs that you’re doing that you can give to your staff. Reducing uncertainty about your job is one thing, but if you can make your job easier to do… that’s what buyers really want.
DISCLAIMER: The information contained in this blog is for information purposes only. It is not meant to be considered as business advice. The points of view expressed represent reactions to the current business market and it should be noted that the market may be subject to change in the future. Reader’s specific circumstances may be different and have not been taken into consideration. Always consult with your professional advisors for any business advice.