Did you know that you can start building value in your business now to prepare for a future exit? Whether you’re looking to sell in the next year or five years down the road, the steps you take now will determine the quality of buyers you will attract and what your business is really worth to another party. Selling a business isn’t just about listing it; well before that time, it’s about building it into something that buyers want to compete for – and that takes hard work and intentional planning.
Understand Your Goals
Many owners begin planning their exit only when they’re ready to sell. However, the best outcomes come from reverse-engineering your path to achieve the desired outcome. Whether that’s a full retirement, a partial exit with continued ownership, or simply stepping away from day-to-day operations, your personal goals should guide every decision in your exit strategy.
Building Value Through Your Finances… But That’s Only One Step
Your business finances are of course one of the main indications of business health and value. A potential buyer will want to see consistent earnings, healthy business margins, and financial statements that provide a clear picture of your business’s current state, past performance, and future direction. Areas to focus on:
- Enhance profitability by reviewing costs, renegotiating vendor terms, and adjusting prices as necessary.
- Strengthen cash flow through improved billing practices and effective follow-up on receivables.
- Organize your financials with professional-grade bookkeeping and timely reporting. More on that below!
Building Value Through Your Operations
If your financials reflect the health of your business, your operations reflect its potential to scale. Inefficient operations make it harder to hit your goals—whether you’re growing, preparing to sell, or both.
When a business runs smoothly, it’s not just more profitable—it’s easier to scale, easier to transition, and less reliant on any one person.
Operations questions to consider:
- Are your operational, financial, and other processes clearly documented and repeatable?
- Have you eliminated bottlenecks or redundant workflows?
- Are your vendor and supply chain relationships stable and cost-effective?
Cleaning up your books is something you can do right now to improve your financial presentation to other parties – the less confusion and uncertainty in your numbers, the more a buyer will trust the numbers and pay fair value.
Well-run operations, whether financial or otherwise, demonstrate lower risk and higher scalability, two qualities that consistently drive stronger valuations. Whether your exit is around the corner or years away, focusing on your operations now will pay off in the long run.
Building Value Through Your Brand
A strong brand helps your business stand out in a crowded market and creates trust with your audience. It clearly communicates who you are, what you offer, and why it matters. When your brand is consistent and recognizable, it becomes easier to attract and retain the right customers. For business owners, this means stronger customer loyalty, better market positioning, and ultimately, increased business value. When your brand is clear and trusted, it not only supports growth today but also adds strategic value in the eyes of potential buyers.
Building Value in Your Products or Services
What you sell and how well it performs have an impact on your business’s value. It’s not just about having a wide range of products or services. What matters most is that each one is profitable and supports your long-term growth. If you’re offering something that isn’t generating a profit or requiring excessive resources, it may be time to reconsider it.
Questions to consider:
- Which products or services are most profitable? (A segment profitability analysis will be helpful in determining this.)
- What products or services require excessive time and resources and do not produce a sufficient return?
- What new offerings or improvements could differentiate you in your market and also boost profit?
Everything in your business should be working in harmony. A focused and profitable offering mix shows buyers that your business is healthy, efficient, and full of potential.
Ready to Maximize the Value of Your Business?
Sabre Financial Group works with you throughout all phases of your business, whether you need a fractional CFO and Controller to support the financial function of your business or a buy-side or sell-side Advisor to assist you throughout the M&A process.
Selling your business is more than a transaction—it’s a transition that may be one of the most significant events in your life, and it deserves the utmost planning, strategic insight, and a partner who understands the value you’ve created. If you’re preparing for a sale now or laying the groundwork for the future, Sabre can guide you through every step. Schedule a consultation today to start the conversation.