Perhaps, this new year was the first time you seriously considered selling your printing business. You have always known that you would have to sell your business someday. But maybe this January you resolved to act. It’s a good time to reflect on the direction of your life and what you want to do differently.
Here are six things to consider if you’ve got the itch to sell.
The Process will be Emotional
Everyone has a different motivation for selling. For some it’s related to their age or health. Some owners aren’t making money and are just eager to get out of the mess and pass it on to the next buyer. Some are just tired of keeping up with all of the changes, risks, and investments. They are just ready to retire and move on.
Perhaps you always envisioned passing on the business to your sons or daughters. It can be heart-breaking to learn they really aren’t that interested in running your business. It might take three or four years before you are emotionally prepared to sell it someone outside of your family.
These emotions are normal and understandable. But as you get ready to sell, you must learn to think more like a buyer.
Every Seller Starts with Similar Questions
When should I sell? How should I sell? Who’s going to buy me? While the questions may be the same, the answers will differ greatly for every business. A lot depends on the current state of your business and how much potential prospective buyers can see in it.
You May Not See Your Business the Same Way a Buyer Does
Considering how many years of hard work you put into building the business, you might think it is worth more than a potential buyer does. But potential buyers will be less interested in the history of your company than its future. A buyer will want to verify that all the upbeat statements in your press releases and promotional materials are indeed true.
Buyers are Sophisticated and Rational
For you, this may be the first time you ever sold a company. But private equity buyers have been down this road many times before. They have assembled a team of experts who will evaluate all aspects of your business.
You must be prepared to answer tough questions about your financial positions, sales team, technology, and market niches. Most importantly, they want to know if your company is in a growth mode or if sales are flat.
Most buyers can determine whether your company has ROI potential within 30 days of meeting you. They know the value of companies and use logical processes to make their buying decision.
Equity Buyers Want Different Things than Strategic Buyers
A private equity company will look for everything to be set up and turnkey. Their decision to buy is based on the how quickly they can capitalize on the potential of a market opportunity. If your printing business is set up for success in a fast-growing niche, buyers will be attracted.
Strategic buyers might be less concerned if everything in your operation is ready to roll. They might be more interested in buying additional production or finishing capacity or access to specific groups of contract customers.
The Transition Process can Take Longer than You Expect
In the old days, selling your printing business was relatively quick and straightforward. These days it can take several years because so many different legal, financial, and tax experts are involved.
If you are serious about the process of getting started this year, reach out to some of your own trusted experts for some objective advice. Find out more about what you need to do to prepare your business for sale.
Each year, the trade magazines report on dozens of printing businesses that are bought and sold. But each transaction is never as simple as it sounds in the press release. The process of selling a printing business can induce just as many sleepless nights as the start-up days did.
Deciding to sell your printing business is a big step. Our goal is to give you the education you need to feel empowered about each of the many decisions you will make during the selling process. We want you to feel at peace with the transaction and embrace the next phase of your life to the fullest.
Want even more on this topic? Listen our podcast episode below on what sellers want most.