How can I maximize the amount of cash I receive when I sell my business?

The short answer is: Acquire every last after-tax dollar and get paid in cash. As with most short answers, it creates more questions and does not really answer the initial one. People want a quick fix to maximizing the value of their business. While there is no instant method for doubling the value of your business over night, there are time-tested guidelines for increasing the amount of money that you get to keep from the sale of your business.

Three Critical Steps in Selling Your Business

• Prepare for the sale of your business.

  
  To maximize the value of your business, the decision should be well planned in advance. Though it is not possible to control the external environment (interest rates, strength of the economy), it is possible to plan for an orderly transition. Start thinking about some obvious sources for a potential buyer. For example, should an employee be groomed for possible succession? Might a good customer be interested in acquiring your business in the event of its sale?
  
  It is never too early to start this planning. Consider reading Planning Your Business Exit the Day You Launch.

• Understand the importance of finding the right buyer.

  
  Most businesses don't have a value that is set in stone. Instead they have a range of value. This means that different buyers will have different perceptions of the same business's value. It is vital to tailor your confidential marketing effort in order to gain exposure to multiple buyers, especially synergistic ones. Synergistic buyers, because of their location, complimentary customer base, financial resources or market position, can profit more from owning your business than other buyers, and therefore they are able (and willing) to pay more.
  
  Find out about ASG's process of finding buyers.




• Strongly consider getting professional help.

  
  Unless you have managed the entire process of selling a business (taxes, legal issues, Mergers and acquitions activities), you will undoubtably make some financially costly errors if you attempt to sell your company yourself. Those mistakes will most probably cost you substantially more than any fees paid for competent professional assistance. Do some homework on various alternatives. Become informed by attending webinars regarding tax issues, estate planning, and so on. Interview different professionals in each of these areas. Feeling comfortable with your advisors is very important to the overall success of your future transaction: Since you are depending on their expertise in this area, so you need to satisfy yourself that they are not only fully qualified in their respective areas (and you are not paying them to go through the learning curve in a new arena), but also that you can trust them to have your best interest at heart.

Following these steps give you the best possible platform for selling your business. Your pre-planning work will strengthen your company and have it present well to future buyers. Marketing your strengthened company to the correct group of potential buyers maximizes their perception of the value of your business. And never underestimate the value added by quality, experienced professionals.