Selling a Business in a Depressed Market

When the market conditions are less than ideal (like now), you’ll probably be reluctant to sell your business. We have already provided useful tips for selling a distressed business, but selling a business in a depressed market is a whole different ballgame. There are many different ways that you can hook a serious buyer who will give you the best price, if you follow some basic best practices.

Bronwen Barnard

30 April 2021

Summary

Can You Sell a Business That Is Not Profitable?

This is different from selling a business in a depressed market. When there are more businesses for sale than there are buyers, sellers will automatically have less control and need to stand out even more from the others. The short answer to this question is “no”. However, it doesn’t mean that business owners are completely stuck – there are options in these cases. One such example is an asset sale. If the business isn’t showing a profit, but they have other attributes in the business such as specific supplier codes with mines, exclusivity rights to provide a product which nobody else has, or a certain certification or liquor license which is connected to a property, then the business may be of value to those on the market.

What is a Depressed Market?

A depressed market is an alarming downturn in the economy that has lasted for an extended amount of time.

Tips for Selling a Business in a Depressed Market

Give Your Business a Refresher

Your business needs to look good, inside and out, from a potential buyers’ perspective. There are certain things that you can do to make sure that it looks enticing the minute they take an interest.

Move old and unnecessary stock: clutter can be very off-putting for anyone who is on the outside looking in. If you have stock that hasn’t moved for a prolonged period, get it moving by having a sale and remove the clutter.
Attention to detail: if you’ve been putting off repairs on fixtures, fittings, décor, assets and property, then it’s time to start focusing on those and make your business shine! Pay attention to every detail, because your potential buyer certainly will be.
Update your online presence: your buyer will find their way to your website and/or social media, so it’s important that you clean those up too. Keep your offerings relevant and your photos up to date, and try to get some engagement going with your existing customers to show some movement.

Price Your Business Right

You won’t want to scare off potential buyers with a price that is unreasonable, nor do you want to allow them to take advantage of the pressure of selling in a distressed market. The best would be to get a fair, professional business valuation and take into account the economical impact, and then price your business correctly.

Find A Reputable Place to Market Your Business for Sale

In other words, go where the buyers are. Business for Sale is an online business broking platform that matches buyers looking to buy different businesses with sellers looking to sell. Our platform makes it simple to list your business in a distressed market, and we can even provide a professional business valuation.

Author: Bronwen Barnard

Director

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