Who are you competing against when you want to sell your business? Most certainly, similar businesses in your industry and other companies selling the same service or products. But, consider that your biggest competitors might be entirely different:
- Any company of a similar size and EBITDA is a competitor if you hope to be purchased by a venture capitalist or investor. What business you are in may be less important, as long as you are profitable and have a sustainable business plan. Your competitor could be on the other side of the country in a totally unrelated field.
- If you hope to pass the business on to your children, the competition is any distraction from that plan. It could be another career, a different business venture, a dream to travel the world, or a spouse who doesn’t want them to work that hard. But the biggest issue is often lack of communication: you just haven’t had the serious talk that begins the process of planning for transition.
- If you’re hoping one of your senior managers will take over, your competition is their other opportunities. It could be companies looking for good senior managers (and they always are) or their families wanting them to slow down, retire, and spend the winter in warmer climes.
Your competition may not be any of those: Marc Lacoursiere, president of TAC, points out, “Your greatest competition is ignorance, complacency and inertia.”
Ignorance: Most entrepreneurs are not consciously aware that they have an inherent responsibility to make an exit plan. The ownership of the business will change, one way or another. Without a plan, you might never sell your business and if you do, it won’t be on your terms.
Complacency: I’ve often heard, “Selling my business is at least five years away.” But the timeline keeps extending – sometimes until owners are well into their seventies! Like the “boiling frog”, some owners need a whack on the side of their pot to stir them to action before it’s too late.
Inertia: Day-to-day life gets in the way. You’re stuck and don’t know how to move forward. You spend too much time IN the business and not enough time ON the business. It takes courage, fortitude and determination to change the path you’re on.
Think beyond other businesses like you in your community. Other forms of competition, including yourself, could blindside your best intentions. Without a thoughtful plan and considered change process you could be left behind. If you need help, a coach can assist you to identify and expand your options.