Your business might be your baby but is it finally time to let go? Summit Advisory’s Deborah Potts outlines some questions to help you make the decision.
Just as the natural world has its own life cycle, so too do businesses and their owners. It may be that 2019 is the right year for you to sell your travel business, especially if you can identify with one or more of the following statements.
I used to love my business but it isn’t as much fun as it used to be.
Is entrepreneurship in your DNA? Conceiving your business idea and turning it into reality was, no doubt, a challenging but highly stimulating and satisfying journey. But entrepreneurs do not always make the best managers. If your daily business life no longer suits your nature, cashing in and capitalising on the business you created, but no longer love running, could make sense.
I have taken my business as far as I can.
Every business goes through a life cycle. You may have identified great opportunities for profitable future growth, or you could be facing a slowdown or stagnation in your business. Both situations may require a further financial investment. However, you may be at a life stage personally when you no longer want to reinvest or risk your hard-earned capital to support your business further, given the time it may well take to see a return on that investment. You recognise that the time is right to find new owners capable and keen to take your business to its next stage.
I want to reap the rewards of my success
You’ve worked hard and now want the pay-off. Whether it’s spending more time with your family, pursuing hobbies or travelling, the proceeds of a successful business sale can open up lifestyle choices dramatically for you and your loved ones.
I want to do something different
Much as you have enjoyed running your own business, you may well feel you have more than one career in you or crave turning your talents to other roles or challenges. Simply wanting to do something different can be the deciding factor to trigger a business sale for many entrepreneurs.
I’m just getting too old for this
None of us lives for ever. You may have hit a stage of your life when you yearn to take it easy and enjoy a well-deserved retirement. However, many business owners view their business as their pension. If you’re depending on a successful business sale to allow you to retire, say, in 2020, then you need to commence your business sale process in 2019. A business sale typically takes nine months to a year. Although there are exceptions, don’t leave it so late that you jeopardise value or your future plans. We recommend that you ideally talk to an advisor at least two years before your target exit date.
I’ve been approached to sell my business
Selling your business may not be on your agenda this year but what if you are approached out of the blue and you find yourself tempted? This is a situation that requires careful handling. A buyer making a cold approach off-market is generally hoping to avoid a full-scale competitive process and pay less than they might have to otherwise. This, of course, assumes they are serious in the first place and not just fishing, or on an intelligence-gathering exercise. Proceed with caution and take advice. If your New Year’s resolution was to sell your travel business in 2019, for whatever reason, don’t leave it to chance. Plan early and ensure you have the right professional support to deliver that deal of a lifetime.