Niche Exit Planning Strategies
Selling a Design Business
Over the past few years, the design business industry has seen more than its share of fluctuations in business values. Many sellers have exited their companies under less-than-ideal circumstances. Yet it's still possible to achieve personal and professional goals when selling a design business during challenging economic times.
The business-for-sale market is just as frustrating for buyers as it is for sellers these days. Although there are plenty of entrepreneurs who want to buy a design business, capital restrictions are holding them back.
Does that mean selling your design business will be a piece of cake? No -- but you might be surprised to learn that the design businesses that are selling these days are finding success though simple, common sense selling strategies.
The Case for Confidentiality
In the business-for-sale universe, publicity translates into risk. If you are rigorous about maintaining a confidential sale, there is little risk in putting your design business on the market. Eventually, word will leak out. When that happens, it can damage your standing with customers and vendors. Although it can be difficult, it's important to strike a balance between confidentiality and sale promotion. We recommend consulting a business broker to learn how you can simultaneously identify prospective buyers and maintain a confidential sale environment.
Sale Costs
In a design business sale, pricing is based on a number of factors, including the costs incurred during the sale. Good brokerage takes a 10% success fee off the top of the final sale price. Depending on your circumstances, you may also incur substantial expenses in hiring legal, appraisal and accounting professionals. Furthermore, your time has value, so you may need to include a personal compensation consideration in your expense estimates.
Preparing Family Members
Since your business was a family affair, your family members should also be involved in its sale Unfortunately, families often experience turmoil during a sale even when the primary owner is convinced it's the right decision. The sale of the business will likely result in new family dynamics. Subsequently, selling a design business should allow opportunities for all family members to share their feelings and offer input about the sale process.
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