By Harold Laufer, Esq.

You’ve worked hard over many years to build a successful business. Maybe you’re starting to think about retiring, or maybe you’ve figured out that the company is now worth so much you ought to consider selling it.

Before you just list the business with a broker or talk to your golfing friends about whether they know anyone who might be interested in buying, you should give some thought to things you can do to increase the sale price…because with some pre-sale planning a business owner is often able to substantially increase the value of the business.

The steps you can take depend to some extent on how much time you have to work on value enhancement before a sale. Some steps will obviously take longer than others. Here are some examples: if too much of your business is concentrated in too few customers, that will always decrease value. If you have the time to do so, start working on expanding the list of key customers.

Look at your financial statements closely. Are your expenses and margins where they ought to be? Now is the time to make those hard decisions about personnel and overhead that have been easier to avoid up to now. Should you consider refinancing the company’s loans to free up cash flow, which will certainly make the company look more attractive? Do the plant and the equipment in it look well maintained? A company has curb appeal just like your house.

Finally, your financial performance is always key. If the recession really hurt your results, have you proactively taken the steps over the last few years which you identified are needed to increase profitability? Make use of your team and your advisors to identify actions which will help to show better performance for a reasonable period before the sale.

Bradley, Gmelich & Wellerstein LLP has represented hundreds of companies, and has helped dozens of business owners achieve successful sales.  But you can do even better if you think about increasing your company’s value before you put the business up for sale.

We can help!