A recent blog post by Marc Gudema at Baystate Business Brokers provides a great example of how preparing in advance for a business sale can help the value of your business. Marc focuses on the need for established companies to update their marketing by creating or updating their web sites and using social media. We call this preparation “optimizing” for the sale of a business. As lawyers, we help clients focus on optimizing their Assets & Liabilities, Contracts, Personnel, Intellectual Property and Company Records. But there’s a lot more to optimizing than just the legal stuff, and Marc’s blog points out a number of ways that a business can create value by making better use of the internet for marketing.
At the end of his blog, Marc points out the additional, possibly huge, benefit that comes from preparing well in advance of a sale. The benefit is that the business owner will recognize an increase in business from that preparation while he/she still owns the business. Remember when you updated your kitchen at home? It was a pain, and cost a lot, but not only do you get to enjoy the update while you’re living there, but it will add to the market value when you sell the house. The same is true in a business. Think about what will create more value for your business at the time of sale, and do it now, in advance. The result; more money while you own the business – more money from the sale. That’s the win twice that comes from thinking about your business succession plan in advance and acting on it.
Remember, your business in an investment, not just a job. Similarly, think of the cost of your advance preparation as an investment, not an expense.