3 Steps to Take Today to Sell Your Business for Top Dollar Tomorrow

Here are three concrete steps to follow as you prepare now to sell later.

The Thrive Global Community welcomes voices from many spheres on our open platform. We publish pieces as written by outside contributors with a wide range of opinions, which don’t necessarily reflect our own. Community stories are not commissioned by our editorial team and must meet our guidelines prior to being published.

I was teaching a workshop for our business coaching clients when one of them asked, “When I’m ready to sell, what can I do to get top dollar for my company?”

While that’s a solid question, an even smarter version asks, “What can I do today to prepare to sell my business two to three years from now?”

The time to prepare to sell your company is now, not years down the road when you finally feel ready to exit.

Here are three concrete steps to follow as you prepare now to sell later.

Step 1: Determine what your business is currently worth.

How do you find out what your business is currently worth? You can look to industry or association sources for the most common valuation methods for your type of business. You can hire a valuation firm, work with an investment banker, or even hire a CPA experienced in your industry and type of business. At the very least, get online and start to research tools to help you value your company.

Even more important is understanding how companies in your industry and business category are valued by the market.

What formula is most commonly used? What is the current range of business multipliers and how can you command the top end of that range? Find out!

This lets you start today to hone how you build your business to make it more valuable to a future. Generally, the things that make your business more valuable to a buyer are things that make your business a better company to own (remember, buyers are smart–generally!)

Step 2: Do a “buyer’s audit.”

Put yourself in the shoes of a potential buyer and take a hard, long look at your business.

  • Which elements give it value in an outsider’s eyes?
  • What major risks do you see that scare you as a potential buyer?
  • What are the most attractive parts of buying this specific business versus one of its competitors?
  • What are the least attractive parts of buying it?
  • If you could change only three things to make it more attractive as an acquisition, what three specific things would you change over the coming 12 months?

Step 3: Mitigate risks and enhance value.

There are 6 major causes of risk for a potential buyer (see below). Your job is to do everything you can that mitigates these risks and enhances your company’s value.

6 Key Risks from a Buyer’s Perspective:

  1. Management team: How talented are the managers? Will they stay? What happens if one or more leave? Who will lead the enterprise as a whole?
  2. Reliance on owner: Will this business work well without you (the owner) around? Which customers rely on your personal relationship to keep them happy? What banking relationships are based on your personal financials or rapport with a specific banker?
  3. Truth and accuracy of financial records: Are your financial records clean and up to date? Have your financials been audited by outside firms? Are there any warning flags like discrepancies between corporate tax returns, filings, or investor reporting and the company financials?
  4. Customer base (concentration and future prospects): Are the customer relationships with the company or with the owner? Is any one customer so big that the business would suffer if that customer’s orders diminished or went away altogether? What are the future prospects for your key customers? Your industry? Your specific business?
  5. Competition: Where does your company stand in the marketplace compared to your competitors? How will you assure your prospective buyer that sales and market share can grow, not just be maintained?
  6. Industry future: What trends affect your industry? What potential disruptors could kill your industry overnight? What contingencies do you have for these scenarios?

The bottom-line question is this: “Are you taking action to mitigate as many perceived buyer risks as possible over the next two to three years before you sell?”

Mitigating risks is half the equation; the other half is enhancing value. What can you do over the next few years to enhance your business’s value?

  • Can you grow your sales?
  • Develop protected intellectual property?
  • More firmly establish a brand?
  • Deepen competitive advantages?
  • Build company systems?
  • Grow the management team?

Now it’s time for you to take 60 seconds to list out the top 3 action steps you are going to take in the next 90 days based on what you learned in this article. Do it now!

Also, to help you grow your business and get your life back, we just put the finishing touches on a powerful free toolkit which includes 21 in-depth video trainings on how to intelligently scale your company. To access this free toolkit click here. Enjoy.

Originally published at

Share your comments below. Please read our commenting guidelines before posting. If you have a concern about a comment, report it here.

You might also like...


Selling Your Business

by David Finkel

Selling Your Business

by David Finkel

Terry Monroe of American Business Brokers & Advisors: “You need to know yourself”

by Jason Hartman

Sign up for the Thrive Global newsletter

Will be used in accordance with our privacy policy.

Thrive Global
People look for retreats for themselves, in the country, by the coast, or in the hills . . . There is nowhere that a person can find a more peaceful and trouble-free retreat than in his own mind. . . . So constantly give yourself this retreat, and renew yourself.


We use cookies on our site to give you the best experience possible. By continuing to browse the site, you agree to this use. For more information on how we use cookies, see our Privacy Policy.