Preparing your business for sale takes time, which means that you need to plan well in advance. Especially as it is highly unlikely your business will be entirely ready to sell.
It’s an all too common occurrence that when most owner businesses feel ready to sell their business emotionally, the reality is that their business is a long way from being in a position to sell at its maximum value.
Corporate Finance specialists call this process ‘Readying your business for sale.” It’s the period when the business is analysed to reveal weak areas that could lead to a negotiation on price.
This period is where marketing can play a significant role in helping to sell your business for its maximum value. Especially if you need to improve market presence, sales performance and brand reputation to enhance the eventual sale value.
Planning in advance will help you to identify the areas that may give a potential buyer the opportunity to chip away at the asking price. Planning early also gives you the opportunity to make the improvements so that you achieve your asking price. Having a business that is ‘ready to sell’ may also reduce the time to complete the transaction.
There are two other compelling reasons to begin to prepare your business for sale:
- Most of the areas you improve are in fact, good business practice and will have long term benefit.
- You never know when the opportunity for sale might arise—an offer may come along that is too good to pass up, and you need to be in shape!
Here are some areas where marketing can help during the period leading up to the sale:
Corporate Reputation and Branding
Your company brand identity and reputation is based on the perception that your customers, and those who influence the purchase decision have gained from what they have seen or heard about your company, or their interactions with it.
In a lot of instances, a company branding and identity becomes neglected over time. Upon scrutiny during this planning process, it may be decided that it looks out dated and not representative of the business in the current day. This can deter potential buyers or give them an excuse to negotiate the price.
When positioning a business for sale, the role of your marketer is to help promote the image that your company wishes to portray. Effective marketing can help a business punch well above its weight.
If you do decide to rebrand, please bear in mind that rebranding should be much more than simply changing a logo. A rebrand initiative is your opportunity to alter perceptions, drive a change in the behaviour of your staff and an opportunity to wipe the slate clean and drive forward a new era in your business. These process improvements can help to increase the value of your business.
If a rebrand is required to help improve your companies image to the outside world, it is important to appoint marketing experts who will take the time to understand the reasons for rebranding and ensure youroverall objectives are achieved.
CRM/Data Management
Every marketer will tell you how important it is to know your customer. No matter what your industry, no matter what your focus, no matter what kind of products or services you offer, your customers are the single most valuable asset of your organisation.
To a buyer, this intelligence is potentially the most attractive part of your business. It will be important that you can demonstrate a cohesive and compliant data gathering and storage process, and that you can use this intelligence to make important business decisions.
That is where an expert marketer can help you implement a CRM (Customer Relationship Management). When utilised correctly, a CRM system will help you perform a number of data related tasks including:
- Store Organisation Data: An effective CRM will allow you to build a profile of your customer and their buying behaviour in a compliant and data intelligent manner.
- Improve your customer service: A CRM system can record and report all contact that your customers have with your company. It can also be made available to staff involved in their account and enable them to make better decisions.
- Improved analytical data and reporting: A CRM that is easily integrated into other systems has the ability to generate reports on which you can make effective decisions and build customer loyalty and long-term profitability.
Promotional Practice
The next area where marketing can help improve the value of your business is by ensuring your brand is respected and is high profile in your chosen markets.
This can be delivered by a well thought out marketing strategy with supporting promotional activity that demonstrates you understand your customers. This may involve regularly issuing marketing communications that convey how your products or services solve their problems.
It is also important to have reporting processes that produce analytical data to show your KPIs have been met and your marketing practices work.
Communications
Making it public too soon that you are planning to sell your business can have a negative effect on employee morale, supplier relations and customer loyalty.
Whether or not you trust them with the knowledge that your business is up for sale, an expert marketer will be able to help you develop an internal communications strategy that will help boost morale and strengthens relationships.
We have worked for many businesses where the plan was to sell, yet no-one could know. We understand that balancing the differing objectives of the various stakeholders and employees who had to be kept in the dark becomes very challenging, but there is way to achieve this equilibrium.
Summary
It is never too early for business owners to seek advice from experts if they are intending to sell the business or implement a succession plan to sell it to a to a family member or management buy-out team.
Business owners can significantly impact the eventual sale price with careful advance planning and working with experts who have experience of selling businesses and preparing them for sale. Normally people think of accountants and corporate finance people as the experts, but we hope this article shows expert marketing advice can also add significant value.