Top 10 ways to help maximize the value of your business
Wealth Insight: Knowing the necessary steps can help support better decisions around the sale of your business.
Selling a business
- Reduce expenditures, including salaries and administrative costs.
- Defer any expansion that would take years to show a profit.
- Increase gross revenue by increasing sales and prices.
- Eliminate obsolete inventory; write off to reduce taxes.
- Clean up accounts receivable. The buyer may not buy them anyway, or may require indemnity if they are not collectible.
- Obtain, and keep current, written contracts from regular customers.
- Diversify your customer base.
- Eliminate unprofitable parts of the business by increasing the minimum price for service work, and reducing the number of stops that the company makes to service a customer.
- Firm up dealer and distributorship agreements, and review or have reviewed by counsel, to obtain authority to pass the business to key members of management, including family members. Dealer agreements may provide that the manufacturer must consent to transfer the franchise.
- Seek to obtain good multiyear contracts with vendors and suppliers.
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The information contained in this communication is not meant to substitute for a thorough estate planning and is not meant to be legal and/or estate advice. It is intended to provide you with a preliminary outline of your goals. This information is for educational purposes only and should not be interpreted as legal opinion or advice. Please consult your legal counsel for additional information.
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