Why Now is the Ultimate Time To Sell Your Small Business

Why Now is the Ultimate Time To Sell Your Small Business

Things are looking up for the entrepreneurial ecosystem. Small businesses are continuing to feel the effects of current economic growth, and many business owners are starting to feel optimistic about selling their businesses due to climbing asset prices.

“Private equity spending power has topped $1 trillion, a buyout bubble is possibly on the horizon, and competition is driving valuations and demand,” Entrepreneur reports.

Not all entrepreneurs are looking to stay in their businesses for the long haul. Many entrepreneurs go into business with specific goals in mind: To make a profit and sell their business once they have earned a certain amount of income.

These entrepreneurs are in luck. As the small business sector continues to succeed, 2014 will likely be an optimal year for small business owners looking for an exit strategy. Here we identify why now is a great time to sell your business.

Threat of increasing interest rates
Although there’s been a lot of chatter over the past few years about the potential for interest rates to rise, Entrepreneur reports that 2014 could very well be the year that this actually becomes reality. If small business owners looking for an exit strategy wait too long, then they might have to endure these higher interest rates, leading to lower business valuations and a smaller pool of candidates due to a probably decrease in loan acquisitions. With the threat of a rise in interest rates in the imminent future, now remains an ideal time to consider selling.

Steady profit
Because of the recession’s big hit on small business, 2008, 2009 and 2010 remained slower years growth-wise for most businesses. However, the new decade brought in slow but positive economic growth, which has helped these businesses recover over the past few years. As consumer demand has increased accompanied by an uptick in consumer confidence, businesses have had the opportunity to recover and again have the ability to establish three to four years of continual growth – ideal numbers for prospective entrepreneurs looking to invest.

Having a positive upward trend line in historical financials offers potential buyers rosy projections for future growth, making valuations better and the odds of a sale higher,” Entrepreneur reports. As we’ve indicated, selling is all about time, and waiting any longer may have a negative effect on your business’ growth numbers.

Don’t let yourself fall into the greed-ridden track of entrepreneurship. The wisest entrepreneurs are the ones who realize the right time to get out and strategically sell their business. Taking this leap can be tough for small business owners, but missing the ideal window to sell and ultimately missing out on thousands of dollars may be even tougher.

If you’re ready to sell your small business but aren’t sure where to start, contact a business coach at AdviCoach today.

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