When a buyer looks at your business for sale, the very first things they look at is the numbers driving the business. While keeping track of your financials is good business practice, during the sale process, it could mean significant differences in the final sale price. Going into details here is always better, for example tracking Sales/COGS by product, advertising (FB vs AdSense vs Other), salaries, VA costs, warehousing costs, and refunds to name a few.
A well kept and organized financial statement tells the buyer that the business has been maintained well and inspires confidence that the business can be carried forward successfully.
Google Analytics data has always been sought after by Buyers as it gives them direct insight into multiple facets of the site’s performance. It is very common for the buyer to request read-only access to this when reviewing the business. Monitor this on a regular basis to ensure that there are no significant outages in collection of this data.
Other measures such as keeping track of conversion rates, success rates on email campaigns, Domain Authority ratings, and in-cart upsells, adds to the impression of a well-organized business, likely leading to better offers to buy your business.
Accounts and Bank Details
Review all your accounts (social media accounts included) to ensure that all of them are set up with your companies email address and bank details. All too often they may be set up with personal email and payment details, which may complicate the transfer process to the New Buyer and delay the transfer process. Addressing this before the sale process will give you enough time to deal with any issues before they come up.
Support timeframe, where the Buyer can have the Seller available to answer any questions related to running the business. These timeframes typically range from 1 week to 3 months of support (the latter typically for six-figure businesses). To minimize your time commitment in supporting the seller, try to get as much documented upfront before the sale.
Step back from the day to day work you do and start documenting all the processes you follow. This may include, how to add new articles or products onto the site, FAQ’s, how to manage marketing activities, affiliate management, and even how to track and manage Inventory. If you have staff that helps with the business document what they look for to make roles and responsibilities clear.
Make a list of all the important persons related to the business, VA’s, content writers, suppliers, shipping agents, account managers for any of your plugins, and influencers you may have used. This will help the buyer to self-serve most questions when they have a list of names and contact information for these key people.
Depending on the nature of your business, only some of the above may apply or there may be more. This is just a guide to help you think through the thing to expect when you are selling your business.
Keep in mind that the Buyer may not have the same skill set as you and having everything documented up front will widen the appeal of your business.
When is the Right Time to Sell?
Once you have all your ducks in a row, it’s time to start thinking about when you’re going to sell your business.
Before you give yourself an exact date on when you plan on selling your business, it’s extremely important to double down on your operations to try and grow the business as much as possible. A strong 3-month growth trend right before you sell your business creates a positive image that the business is going in the right direction. This is very attractive to potential buyers.
If you’re unable to spend extra time on your business, it is very important to at least maintain current operations and keep the revenue and traffic stable. Too often, sellers will plan to sell their business a few months out and then lose interest in growing the business, so the business starts to decline. When it comes time for them to sell, they realize that their valuations are much lower, compared to the ones they received several months earlier.
Finding the right time to sell your online business can be tricky, and some may have more time than others. Instances like focusing on your health, or selling the business before the introduction of a new family member, may require you to sell when it’s not convenient. While this isn’t ideal (from a valuation perspective), it is always important to sell at the time that is most appropriate for you.
Is There Anyone That Will Help Me Prepare My Business for Sale?
Yes there is! If you have a business generating over $1,000 in monthly profit, it may be worth your while to reach out to a broker. Most online business brokers will provide monthly plans for you to reach your targets and help you maximize your final valuation and sales price.
If this is something that may interest you, we have over a dozen partnered brokerages that specialize in helping online business owners sell their business. You can view our Partnered Brokers here.