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Making the Big Decision: Selling or Keeping Your Business?

Updated: May 9

Selling your business is undoubtedly one of the most significant life choices you will have to make. It's not uncommon for sellers to contemplate keeping their business instead of selling it.

Do I Keep My Business?

If the owner is content running and developing their business, and the business's performance remains stable or shows signs of improvement, then keeping the business may indeed be the best choice.

The argument in this scenario is rooted in risk analysis. Investing in a private business can be inherently risky; uncertainties abound, and revenues often lack the security of long-term contracts.

In the digital age, competitors are increasingly visible to customers, and employees are more mobile, thanks to online job boards like LinkedIn. To mitigate these risks, buyers typically seek investment yields of 20 - 40%, aiming to achieve a return on investment within 3 - 5 years.

Assuming the seller could generate similar profit levels by retaining the business, they effectively hold onto a valuable asset over time. It's a logical conclusion that keeping the business may be the better choice.

Do I Sell My Business?

If financial motives don't drive you to sell your business, why do people still choose to sell?

Through our extensive experience dealing with various sellers, we've compiled common reasons why business owners decide to sell:

  • Desire for Change: As a business owner, you may seek a new challenge or wish to capitalise on the value you've created in the business to date. Proceeds from the sale could fund a new project or provide financial freedom to restore neglected work-life balance.

  • Industry Threats: The business might be better positioned to weather industry threats under the umbrella of a larger owner.

  • Health or Family Changes: Health issues or shifts in family circumstances may prevent you from devoting full attention to the business, leading to short to medium-term deterioration.

  • Business Growth: The business has grown to a level where it's challenging for the owner to manage everything. Delegation and necessary resource investments for growth become difficult.

  • Loss of Passion: If the business no longer brings joy due to people issues, legislation, or process-related challenges replacing creative input, selling might be considered.

If you identify with any of these points, selling your business could breathe new life into it post-sale. Injecting new blood, capital, and ideas can reinvigorate the business, fostering renewed enthusiasm among existing employees.

CLICK HERE for information about how we can help you achieve a successful sale.

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