My father was a fanatic about keeping things organized and paying attention to routine maintenance, especially when it came to cars. When I got my first used car in college, he would implore me to change the oil every 3000 miles and rotate the tires, etc. He also was insistent that the car should be kept clean. “Just keep up with it and then it won’t be a fire drill when it’s time to sell it,” he would say.
He didn’t really need to remind me about the oil changes. My brother, and I had been crawling under his car for as long as I could remember. He didn’t believe in Jiffy Lube especially when he had cheap labor hanging around. We would build a small ramp with random bricks so that we could get the car high enough off the ground for us to fit underneath and reach the oil pan and drain it. So, it became a habit. It was not my favorite activity, but I was happy when I sold my car and demonstrated that I had been diligent about basic upkeep. The buyer was reassured. Conversely, a friend of mine put off his oil changes, as in he never changed his oil, and ended up with a blown head gasket.
What does this have to do with running your business? I have worked with many small and medium sized business owners that get extremely busy and they put off keeping up with the tedious necessary evils of the day-to-day mundane tasks because they are not front and center.
Opportunities to sell your company will inevitably present themselves when you least expect it.
Just like regular oil changes, that means that you should keep up with a few key things at a minimum on a consistent basis.
Work with an independent professional to value your business regularly and determine your business’ worth in the marketplace. More importantly, keep this advisor in the loop to help with your business strategy so that they can scan the marketplace and connect you to any opportunities that might arise.
It should go without saying that your financials need to be organized and current.
Clean up any litigation your company is involved in as quickly as possible.
Get your legal paperwork in order. All contracts with customers and vendors along with your leases, corporation documents, employment agreements, etc. should be up to date.
Think through why your business would be attractive to different types of potential buyers.
There are countless other pieces of information that should be ready and accounted for, but the point is this. You should keep your business as clean and attractive as possible. Waiting to address issues until a prospective buyer appears will inevitably cause problems and make preparation for a transaction longer than it should be.
Even if you don’t plan on selling your business today, you should run it as if you will.
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