Selling your business successfully is all about the timing. Of course, there are many other factors to consider, but if you market your business at the right price, at the right time, it will sell.
Many people will tell you there’s a ‘selling season’; some will say Spring is the best time to sell, as buyers are excited about new ideas. Others will say Summer because the weather’s fine and everyone’s happy! In the US, they tend to favour the Fall.
The fact is, YOUR perfect time may not be somebody else’s. Choosing the best time to sell your business is influenced by your situation, your industry, your location and the current state of your business.
Let’s take hospitality businesses as an example. If you own a seaside café, it will look its busiest in the Spring and Summer. However, if you wait until Autumn, after the busy season, you’ll have an impressive set of numbers to show prospective buyers.
If your café, restaurant, hotel or B&B is in a snow resort, however, the complete opposite applies. Take your photographs during the busy season and sell at the end of the season when the books look good.
It’s also great to market a hospitality or accommodation business with forward bookings in place.
This rule doesn’t just apply to the hospitality industry; some retail products and services are seasonal, such as swimming pools, air-conditioning, wood burning heaters and garden products.
In both retail and hospitality, the post-Christmas/New Year period can be a good time to sell as your turnover should be looking good. However, some retail businesses experience a slowdown in January and February, with potential customers still paying off their credit card debts from Christmas!
But January and February can be the perfect time to market health and fitness businesses, such as gyms, golf courses and spas. This is when everybody’s New Year resolutions are kicking in and they want to get fit and lose weight for summer.
If you finish the financial year on a high, having had a clearance sale or fixed up outstanding debts, that’s a smart time to get your business on the market. Potential buyers love the fact that last year’s issues have been dealt with and they can walk straight in and continue running the business on a high and grow the profits.
One thing’s for sure, NOW is an excellent time to be selling your business – and a great time to buy! According to recent figures from the Australian Bureau of Statistics (ABS), the number of actively trading businesses in Australia has increased for the fourth year in a row. That’s the sign of a strong market.
The number of businesses has grown across all States and Territories, with the ACT seeing the largest percentage growth.
That growth is showing itself across a wide range of industries, including hospitality and tourism, child care services, community services, logistics and technology.
If you’re researching what type of business to buy into, IBISWorld is a good source of information. One of their predicted growth areas is wind and other electricity generating industries. They also list dairy cattle farming, sports and recreation facilities, nature and conservation parks.
Buying an established business offers many advantages. In most cases, all the hard work has been done in setting it up, so you can now concentrate on growing the profits. There will already be plans and procedures in place, as well as existing customers, suppliers, stock and goodwill.
An existing business means immediate cash flow and a financial history, so you know what to expect. It also means there are experienced staff in place, existing marketing and an established demand for your product or service.
Buying or selling – it’s all about getting the timing right.
Zoran Sarabaca is the principal of Xcllusive Business Sales
Disclaimer: Chan & Naylor takes no responsibility for the accuracy of any research material of contributors to our newsletter. Contributions to our newsletter such as this “Selling Season: When’s the best time to sell your business And when’s the best time to buy?” post are meant to be educational only, and Chan & Naylor does not endorse any promotional material promoted in their articles. Readers should do their own research to determine the accuracy of their material.