Ready to Sell a Business? The Time May Be Right
If you’re thinking about selling your business in Northern Nevada, the time might be right, due to a combination of factors. For one thing, the stock market’s performance in recent years put more liquidity at the disposal of buyers and investors, and financing is readily available.
For another, there’s a real push toward entrepreneurship. Amid the “Great Resignation,” many individuals are leaving their jobs to pursue greater meaning — and business ownership. Business brokers report that 23% of their inquiries come from job-leavers. Three-quarters of brokers anticipated more buyers would emerge in 2022.
Doing your homework for a successful sale
Before you list your business for sale, it’s wise to take the time to prepare. Our bankers suggest starting with these four steps:
1. Pre-assess your business valuation. Business brokers can be invaluable in preparing a sales package that accurately presents your business’s story for you and your buyer. You’ll want materials to explain the company’s history, future and strategies. Ideally, buyers can take the package to their lenders to help secure financing.
2. Tell the right story in your marketing. In Reno and Northern Nevada, business valuation varies significantly depending on the industry and how the difficulties of the past few years affected your revenues. You can compare your own projections to national averages via the BizBuySell Business-for-Sale Trends and Transaction Activity report, which lists sales by region and sector.
3. Keep your banker in the loop. Your relationship banker may have expertise in your industry sector, as well as a finger on the pulse of the Northern Nevada market. Your banker also is likely to be involved in the deal, especially if you’re closing out debt along with the business. You and your banker can determine whether a buyer will assume the debt obligation or it will be paid off at closing. Your banker can also help assure any liens associated with credit facilities are released, if necessary.
4. Consider bank financing if it’s available. For certain small business transactions, products such as SBA 7(a) loans may be the right choice. These loans require collateral — which may include tangible assets — but borrowers can take advantage of longer terms and lower interest rates in return. And, for specific experienced buyers, some banks may be open to financing business sales.
Whether you’re just beginning to think about a sale or hiring a broker tomorrow, your banker can be a valuable member of your advisory team. Your relationship banker typically understands both your business and the current marketplace. Their experience can help you make a sale you’ll be proud of — and put your financial house in order for whatever comes next.
To learn more about how our bank can support you through a business sale, contact your First Independent Bank relationship manager or visit us online.