There are a number of reasons why you might want to sell some of your accounts or your business. The money from the sale of your business could fund a different business venture or perhaps you simply want to pay off debt and retire. Either way, if you are going to sell your business, you’ll want to maximize the value to ensure you get the greatest amount possible during the sale.
Evaluate The Value of Your Accounts
Selling your business is just like selling your house — if your house is in good condition, the value will be worth more. These are some of the characteristics of healthy contracts that will maximize your value:
- On-time payments from customers
- The contract terms are up-to-date
- You have maintained tidy records of each contract
- Modern equipment
And here are some of the characteristics of unhealthy contracts:
- Equipment using 2G and 3G networks
- Poor payment history
- Bad record keeping
- Poor service records
If you find that your contracts have more in common with the second list, then here’s a list of things you can do to help improve your contracts before you consider selling:
- Improve attrition rates
- Diversify accounts – good mix of residential and commercial
- Update and upgrade equipment
- Improve payment methods – ACH over invoicing
Find a Broker
A broker can do a hefty amount of leg work for you in the process of selling your business. They can help you with the following:
Evaluate Your Accounts – A broker will look at the RMR and other factors to determine the value of your accounts.
Find Qualified Buyers – Brokers can help find buyers outside of your network and find buyers that will pay the most for your business.
Negotiation – Brokers can help with the fine print and help with factors like attrition and terms of the sale.
Although you will have to pay broker’s fees, the fees are always negotiable and can save you a lot of time and headache in the process of the sale.
When you are ready to sell your business, the buyer will want records of payment, service and the activity of the account, so it is important to maintain good record keeping practices.