If you are thinking of selling your business or reducing your shareholding now’s a good time to start planning, as Q Commercial Finance director Steve Parry explains.
There’s no doubt that the Covid pandemic has made us all think about our futures.
Having taken so much for granted just two years ago, we are all now painfully aware how things can change dramatically without warning.
That’s leading many business owners to think about their own positions – and as a result we are seeing a rise in the number of people selling up in the wake of the pandemic.
You might think that the middle of a national crisis is not the best time to be taking such decisions, but there’s a range of options available to anyone looking to sell which means there’s still plenty of opportunity to do so profitably.
The transactions we’ve seen have either involved older business owners looking to fully exit the businesses and retire, or partially exit the business – selling shares on to younger shareholders or individuals key to the business.
A partial exit can be a good way of both breathing new life into your business and ensuring you get a continuing return on your own investment in it – and often you don’t have to go searching for the buyers because they are already a part of your team.
If Covid has made you reflect on what’s important and you want to step back completely, a full sale is more likely to be the answer.
Our experience is that – despite the pandemic – there is no shortage of potential buyers prepared to pay a good price for well-run businesses. Here at Q Financial Services we receive inquiries on a regular basis from clients looking to buy in to successful enterprises, and we see no sign of that changing while interest rates and the cost of borrowing remain historically low.
Of course, you might also consider saving yourself the stress of putting your business on the open market and consider a management buyout. There are lots of advantages to this – not least the ready-made purchaser – but some pitfalls to avoid to if you want to secure the best outcomes possible.
If you haven’t already built an exit strategy into your strategic business planning – and you really should – now is a good time to start thinking about. It will help you focus on business development and set some clear goals for the future.
In all cases, getting expert financial advice and talking to professionals such as the team here at Q is essential. We can help guide you through all the options, plan how to achieve the best results and help avoid any unnecessary headaches.
If you’re starting to think along these lines, don’t hesitate to get in touch.
