Selling a business and achieving liquidity is likely to be the single most important financial event for a private business owner. Timing is perhaps the most critical factor to securing maximum value in the sale of a business.
Typically there are three different types of timing associated in the sale of a business: seller timing, buyer timing, and market timing. Examples of each are provided below:
Key Factors that Drive Timing
Lack of capital
Growth beyond comfort level
Boredom / burnout
Favorable economic climate
Low interest rates
Advantageous tax treatment
Government regulatory changes
Meeting growth expectations
Slow organic growth
Increasing competitive pressures
Diminishing market share
Globalization of industry
While numerous factors may drive a seller to seek immediate liquidity in their business, unfortunately, the needs of the buyer and the conditions of the market ultimately dictate timing and value
Determinants of market timing
Determinants of buyer timing
Understanding and taking advantage of timing will ultimately lead to highest possible valuation for your business.
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