Resources for Entrepreneurs

Business Exits By Industry

Selling a Construction Information Services Business

You've learned a lot during your tenure as a construction information services business owner. The next step is to position your business for the demands of the business-for-sale marketplace.

Are most buyers timid about buying a construction information services business in today's economic environment? You bet.

In our opinion, that kind of thinking doesn't make sense. In fact, this might be the perfect time to sell a construction information services business. We'll tell you what you need to know to achieve a successful sale outcome

Business Valuation

Professional appraisers can use three methods to determine the value ofa construction information services business: The income method, the asset method and the market method. While the income method uses anticipated revenues as a value basis, the asset method focuses on the company's capital, real estate and intellectual assets. In many sales, the most accurate valuation comes from the market method which determines value based on the recent sales of similar businesses. A good appraiser will often use multiple valuation methods to arrive at a reasonable estimate. Sellers should take note of the fact that all three valuation methods reward businesses that takes steps to increase assets and income.

Signs You're in Over Your Head

Many construction information services business are tempted to save brokerage fees by selling their businesses on their own. Although there are exceptions, solo sales typically take longer and are less productive than brokered sales. As a rule, no business should sit on the market for more than six months without attracting the interest of at least a handful of qualified buyers. Likewise, if buyers seem to express interest but quickly exit when you quote the asking price, it's a sign that your construction information services business is priced out of the market. The remedy is professional brokerage or a consultation with more experienced sellers.

Emotional Considerations

Prepare yourself to feel a broad range of emotions when you sell a construction information services business. From hopefulness to remorse, it's all part of exiting of your company. Given your personal investment, you may also experience disappointment in the market's assessment of your company's value. You can prepare yourself by talking through your emotions with friends and family members, and thoroughly evaluating your minimum requirements before you put your construction information services business on the market.

Have Friends Who Might Like This Article?

Tweet via @gaeblerdotcom Share this on Twitter

Let them know on LinkedIn

Ready to Learn More? We Think You Might Like These Articles:


Additional Resources for Entrepreneurs

Lists of Venture Capital and Private Equity Firms

Franchise Opportunities

Contributors

Business Glossary