Here are five mistakes you’ll want to avoid when it’s time to sell your printing business.
1. Thinking that it won’t be an emotional process
Remember all the blood, sweat and tears you shed to build your business? When it’s time to sell, that means saying goodbye to what is often your life’s work and the people who helped you build it. You’re going to go through a range of emotions: Don’t think this will be business as usual.
2. Underestimating the transaction
This is a big deal. Perhaps the biggest one of your life. So don’t underestimate it. It will take a lot of your time and intellect to understand how the deal works and what you need to do to ensure you’re making the right moves.
Educate yourself before you make a move. Talk to people -- especially your peers who have sold a business before. Learn as much as you can before the process begins. The more you know, the easier it will go.
3. Believing your business is worth more than it is
It might be. You may be pleasantly surprised when that valuation rolls in. But then again, you may not. And even if a valuation validates you estimate, a buyer might not agree with the pricetag you’ve put on your business.
Be prepared to adjust your price to reality. Too many owners expect to hit the lottery when they sell their business. Often this isn’t the case.
4. Underestimating the buyer
You know your business. You know it extremely well. In the same respect, a buyer knows their business. They are very adept at the entire process, and they understand the ins and outs of every negotiation and legal contract.
You can’t know their business as well as they do. So back yourself up with a team -- lawyers, business brokers, accountants -- that can help you navigate these potentially tricky waters.
5. Setting unrealistic timelines
Do you want the deal done yesterday? Sure you do. Everyone does. But that might not happen, especially if you don’t have your financials and business operations in order. The entire process can take longer than you expect.
My advice is to set a timeline for a sale. This process takes time. Instead, set deadlines for all the short-term tasks you’ll be encountering. This should keep you moving forward.
While the process is underway, don’t let your business languish. Keep growing your company aggressively so you don’t give the buyer an opportunity to lower the price.
Look, mistakes will be made in this process. You will have a learning curve. But there are plenty of things you can do to minimize the miscues. Be mindful of these tips: It’s the first step toward educating yourself on how to make sure the deal is done right.
Rock LaManna is the author of L&NW's popular column, The Bottom Line. Rock helps printing owners and CEOs use their company financials to prioritize and choose the proper strategic path. He is President and CEO of the LaManna Alliance, and provides guidance on how to grow a printing business, merge with a synergistic partner, make a strategic acquisition, or create a succession plan. Rock can be reached by email at Rock@RockLaManna.com.