How to know if it's time to sell your business

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The first thing you need to think about if you are thinking about selling your business is whether the time has come. So we are going to explain the main key points to take into account and how to sell your company or business while it is running.

Maybe you have new challenges, personal reasons or other reasons. Let's break down the main reasons why you know it's time for a change of scenery and the steps to take to sell your business.

These are the main reasons for wanting to sell your business
These are the main reasons for wanting to sell your business
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The truth is that there are many indicators that tell you when it's the best time to sell your business. For example, its market value may be skyrocketing, with a more than notable increase in demand. And this means that you will be able to get more money for your company or business, so it's the best time to do so.

Especially if you have a profitable business, it is important jordan phone number lead that you can prove it, as it will make potential buyers more attracted. And here another very important factor comes into play: the economic one.

Maybe your business has grown a lot, but you have reached a point where you need to invest significantly to grow further and you are not willing to do so. In this case, it could be a good time to sell.

On the other hand, there are personal factors. Many people set up companies and businesses so that, once they are up and running, they can put them up for sale. They are a very active profile and like to overcome all kinds of challenges. And this means that, when all the 'dirty work' is done, they want a new project. If you have lost interest in the business, it could be a good time to sell before this affects its performance.

Although there may be changes in your personal or family situation that force you to do so. If, for example, you have passed a competitive exam and are going to leave your business, it may be worth hiring new employees to be able to maintain it.

Now that we know the main causes and how to know if it is the best time to sell your business, let's see how to sell your company.

Steps to sell your business
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Although we are going to explain how to sell your company, the best thing you can do is turn to professionals. Mainly because there are many technical and legal aspects that can cause you more than one unnecessary headache.

Selling a company in Spain is a complex legal and financial process that requires a series of carefully coordinated steps. By doing a quick search, you can find all kinds of law firms that are experts in the transfer and sale of companies or businesses. And given the difficulty, it is better to turn to professionals.

Broadly speaking, there are several steps to take. And the most important is to assess the value of your company. So, the first step in selling your business is to know its price.

This is where elements such as EBITDA come in . These acronyms correspond to "Earnings Before Interest, Taxes, Depreciation, and Amortization."

It is a financial indicator used to evaluate the operating profitability of a company, regardless of its financing structure, amortization policies and tax regime.

And it is very important that you study other companies in the sector, since they can sell their businesses for 6 X EBITDA or even 10 X EBITDA depending on their profitability.

You should also keep in mind that potential buyers will want to undergo a due diligence or legal and financial review . Therefore, prepare all legal, financial and operational documents so that they can be reviewed by potential buyers.

Once the first interested parties arrive, they will most likely send you the so-called Letter of Intent, a non-binding text in which they will make you a purchase proposal.

And you still have to negotiate the terms, start the legal procedures... A very complicated process, so although you can do it yourself, do not hesitate to hire the services of a professional.