After having put in the toil and the effort to build and nurture it, you may have now reached the stage where you are considering selling your online business. It is natural progression and can be a rewarding end to a fruitful journey. Every care needs to be taken to get the most out of this process and mistakes need to be avoided to get the best returns when you sell your online business. Here’s a handy checklist of things to do, as well as avoid when you sell your online business.
Things To Do
Let us first take a look at some of the recommended best practices while selling your online business.
- Be Crystal Clear: Clarity regarding the decision to sell should be backed with clarity for the reason to sell too. Ambiguity here can not only cause mental turmoil later (also known as a seller’s regret), but it can lead to you getting short changed during the selling process. Successful negotiations require a power of conviction and firmness in your stand which can only be achieved with total clarity, to begin with.
- Know Your Numbers: Buyer’s eye businesses through the lens or risk and reward. Any perceived risk is likely to diminish the value of your business, while smooth and streamlined operations are sure to raise the value. Keeping all your financial and operational indicators well organized and ready for reference helps you better understand your own business while also giving the much needed confidence that the buyer is looking for.
- Find The Right Medium To Sell: Before you actually list it, you need to identify the right platform to sell your online business on. There are various options to consider based on the nature of your business, the level of experience you have in selling businesses, and your own unique circumstances. While selling privately or directly to a competitor entails the least amount of overhead costs, it requires a high level of personal experience and maturity in conducting such dealings. Then there are marketplaces and social networking platforms where you can list your business for buyers to respond to.
- Take Expert Counsel: Many entrepreneurs turn to aggregators and acquirers who specialize in buying and selling online businesses and have years of experience in the field. This guidance can be useful in increasing the valuation of your business and also to tread the tricky path from listing to making the actual sale.
- Prepare For Negotiations: The entire process can test your patience. Things don’t always work out the first time. Be mentally prepared for a fair amount of back and forth while you negotiate with the buyer regarding the final price and other related terms and conditions. Avoid making decisions based on feelings of desperation, annoyance, or impatience, however, do not give in easily either.
Things To Avoid
It is equally important to know the common mistakes to avoid while selling your online business.
- Selling On A Dip: Experts recommend against selling an online business purely based on a dip in performance. The main reason is that this is bound to hit your valuation significantly. Unless doing so due to a personal or financial emergency do not sell your online business without making some efforts to improve its health. Another factor to consider is the financial impetus that is needed to revive it. If the business case doesn’t make fiscal sense, then this tip may be ignored.
- Burning Bridges: This is especially more important in case you are exiting your business to set up a new venture in the same industry. While selling your current business try to ensure there is a continuity plan for your vendors, supplier, partners and creditors. They are likely to come in handy in your next venture and leaving anyone with a bad taste in their mouth is far from ideal.
- Not Having a Plan B: Sometimes the best laid plans can suffer extraneous obstacles. While you can not preempt each and every hurdle, having a generic plan B is highly advisable. Negotiations can easily reach a stalemate. This is when you need to have your walkaway price or conditions to fall back on. Selling your online business should not mean incurring losses.
We hope the information provided here come in handy when you sell your online business. Use the above tips to get the maximum benefit from exiting your enterprise. If you would like more guidance on the process and the options available to you, then click here to sell your online business.