Like it or not, a private detectives business sale is a complicated affair, made even more difficult by the emotions associated with leaving a business you've poured your life into. In our experience, a common owner concern is how the sale will affect customers and employees.
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Too often private detectives business owners cave under the pressure and settle for a lower sales price than they should. With the right strategy, your sale doesn't have to end that way.
Timing Your private detectives business Sale
Most business owners know when it's time to exit their company. There are a lot of naysayers out there advising private detectives business owners to wait for a better economy to put their business on the market. We aren't nearly as pessimistic about the private detectives business marketplace. With so many sellers holding back, there isn't a lot of inventory out there and you may be able to get a great price for your practice depending on how well you prepare the business and your ability to execute your sale strategy.
The calculation of your asking price should include a buffer to cover the expense of the sale process. 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.
Tips for Seller Financing
Capital is hard to come by these days. Banks and other lending institutions aren't eager to lend to unproven and undercapitalized private detectives business buyers regardless of the business's potential. Rather than abandon their plans entirely, many buyers are pursuing finance concessions from sellers. It's common for sellers to finance as much as 70% of the purchase price with a payoff period of four or five years, sometimes in the form of a balloon payment at the end of the repayment period.
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