8 Reasons to Sell Your Cleaning Business in 2023
As with most things in life, it’s best to plan for the eventual sale of your business. Here is a list of good reasons to consider putting your cleaning business for sale.
The best reason someone wants to sell their business is to retire.The classic reason a good buyer wants to hear you’re selling is for retirement. It’s a great way to fund a retirement and is exactly what many business owners eventually plan on. Selling your business often will give a seller the money, or extra money, they need to feel comfortable retiring. Timing is everything, the best time to retire depends on many different factors with your business and your industry but most importantly when you’re ready for the next step in your life. Most people have a time or age in mind and an amount that they’ll need for their retirement, so you need to make sure the sale aligns with your plans.
Personal / Family Health
Life is not life without your health! There aren’t that many things more important than making money to live. But money is not important if you don’t have good health. There are many situations that you should plan for through Business Continuity planning but that doesn’t mean you’ll necessarily be ready. One of these is a health scare in the form of cancer or another terminal illness. Did you prepare your company to continue operating without you or other key employees being involved? If not, this may be the time to look into selling your business. As with many things in life it’s critical to focus on your personal or loved ones’ health because you don’t always know what the result will be or when it may be too late to try to fix yourself. If you continue to operate the business as you fight your illness your performance and the performance of the business will likely be impacted. It may be best to sell your business while it has its highest value because it’s still running smoothly. Know your situation and make a decision based on all the information that you have been given. Selling may set you free and eliminate all your stress which in turn could help you beat the illness you’re fighting.
Most business owners are entrepreneurs and, therefore, are often looking for the next opportunity or the next step in their business story. Due to this fact it’s a common reason to sell to focus on the next opportunity or have the money to invest in the next business the owner hopes to own. Some people can manage multiple businesses at the same time and others find it too difficult to run multiple businesses effectively. So, sometimes it is best to sell and focus on the next step and let the new buyer come in with their energy to get your business to the next level.
A Fast Growing Business
A really fast growing business is often one that ends up not getting full value as an owner overruns their abilities to grow the business. Therefore, sometimes it’s best to sell the business and let more experienced operators continue to grow it at its current pace. It can be really hard to let go of an exciting business that is in a tremendous growth stage, but at the same time this is the point to get incredible multiples on the sale of your business. A fast growing business generally will sell above market value based on the idea that the growth will continue. However, the risk to you is that the growth won’t continue and that’s why the safest choice can be selling. This may be your big chance to take advantage of selling while your business is worth the most money.
Depending on economic conditions and the appeal of other assets that are available to investors the M&A market can turn into a seller’s market. This is one which is favorable to sellers generally due to the market having more buyers than sellers. A seller’s market arises when demand exceeds supply. In other words, it is created when there are lots of buyers but there are not many businesses for sale. It’s basic supply and demand but it’s very important to pay attention to when you see selling as a natural next step. In a seller’s market you’ll have more buyers to choose from; most buyers will pay more than what is typical and you’ll often get better terms associated with your sale. Therefore, the timing of your sale is very important to the value you’ll receive.
An Offer You Can’t Refuse
Sometimes you’re not even thinking of selling but a buyer decides that your business is worth so much to them that they make an amazing offer. Generally an offer that you’d consider when you’re happily running your business will have to be significantly above market value for you to consider it. Again, timing is everything and it’s unlikely that an offer like this comes around at all or will stick around for long. Therefore, if it’s high enough it’s probably a situation that you should take seriously and make sure you don’t just take a pass on. There are lots of reasons why a potential buyer would overvalue a particular business but it doesn’t mean that this is an offer you can refuse.
There are many important things in life but none that match the importance of your family. You may have big plans for your business but your foundation usually is your family and you need a solid foundation to build upon. Therefore, it’s important to understand your family’s needs and your obligations to them so you keep your priorities straight! Don’t let your business be a distraction to your family and also don’t let your family become a distraction to your business. How do these two thoughts go together? Simple, if you take care of your family obligations they won’t be a distraction to your business. Likewise, if you take care of your business obligations you will have less distractions when you’re with your family and you will be able to devote time to them. The key is limiting your responsibilities to a level that is manageable for the lifestyle you need to maintain. You can run a business with a family but you also can lean on your employees until you’re ready to sell.
Maturing Business or Declining Business Landscape
Your business may have peaked or your industry as a whole could be maturing which will impact growth. An experienced operator that has seen their business grow through exciting times may not be interested in operating a mature business. This does not mean that there aren’t interested buyers that are looking for nice stable, mature businesses. Quite to the contrary, what might be boring for an entrepreneur could be a perfect asset for another buyer or a larger company that is acquiring businesses.
Very similarly, the environment for business can shift from being very welcoming and friendly to businesses, to it being an obstacle to growth. Circumstances will likely help decide if a business owner should sell their business by evaluating if the situation looks to be getting worse over time. If it is getting worse it’s important to sell before market values in your industry are negatively impacted.