Top 10 Mistakes Business Owners Make When Selling Their Business

Business owners are often surprised to learn that only 20 percent of businesses that go on the market for sale actually ever result in a transaction. While external factors, such as credit markets or the overall economy can have some impact on this result, the most important factors are directly under the owner’s control. Most owners don’t take advantage of addressing potential issues they directly control resulting in common mistakes which these common mistakes may cost them their deal. The result of these mistakes may become apparent only during the heat of deal negotiations. Many of these mistakes are a myriad of incorrect assumptions, expectations, and a lack of planning, which were not addressed prior to putting the business up for sale. These issues become gravely apparent often too late to effect necessary change. The following is a list of the 10 most common mistakes made by owners when selling their business:

1. Owners do not realize there can be more than one value for their business at given point in time. Different transition options can result in different transfer values. A business, therefore, can have a range of values, which must be determined. Unfortunately, most owners of a closely held business, in an effort to reduce taxes, have purposely driven down profits. While this may save them from paying more taxes, it will also drive down the value of the business in a sale if done incorrectly.

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Top 10 Mistakes Business Owners Make When Selling Their Business:

For additional information regarding Florida business sales, acquisitions and valuations, please contact Eric J. Gall at info@buysellflbiz.com or 239.738.6227. Also, visit our Florida Business Exchange website at www.fbxbrokers.com and my personal website at www.buysellflbiz.com.