Selling a Business While Maximizing its Value

While there are many reasons for a security or cleaning professional to consider selling their business, the end goal should be to earn the most profit by addressing the key value drivers that buyers will likely use to evaluate that company. 

Common reasons for selling a business include pursuing a new venture, taking advantage of increased interest from private investors, obtaining resources to achieve retirement goals, responding to industry fluctuations or selling was always the plan. 

When it comes to small to mid-sized businesses, these companies face unique obstacles and respond differently to challenges than larger companies that oftentimes have the upper hand. For example, in 2020, the number of small to mid-sized businesses dropped during the pandemic, while the number of large companies grew that same year. 

Regardless of the incentive, the value of the business is important to the buyer, and it will heavily impact the overall sales price and terms. Business owners must take different factors into consideration while reviewing their company long before even considering a potential sale. 

Creating a business plan for review

While weighing the pros and cons of selling a business, it is possible to create a strategic plan for buyers to review. The plan should highlight company goals, state the approach toward growth and offer a forecast of potential decisions. All of these details are important for buyers, as well as a business owner considering selling their company. 

Companies in the security and cleaning industry can take advantage of integrated software designed to provide business data that supports goal-driven decisions and future outcomes. With business analytics, it is possible to create a list of actionable KPIs that support growth while reducing risks. With business analytics, it is possible to create detailed reports outlining: 

• Processes for tracking employee shifts to minimise overtime before it happens
• Benchmark analytics to show where the company stands in comparison to competitors
• AI-based predictive analytics based on learned patterns that support future moves
• Employee monitoring features that track the movements of cleaners or guards 
• Proof-of-service data to confirm work completion to contractual agreements 

Including these details in a business plan shows that data-driven decisions were taken and a strategy is in place. Buyers making a business valuation can gain confidence in a company if there are data-supported business plans in place that support growth and profitability.

Preparing financial records

Selling a company requires reviewing and preparing records, as buyers will want to learn as much as possible about financial health and the cost of operating while minimizing any unforeseen expenses, such as potential debts and compliance-related fees or fines.

Up-to-date financial information can ensure that the buyer understands the financial position of the business while attempting to leverage the best sale price. With integrated financial software, business owners can prepare and provide detailed documentation.

Companies can use an insurance benefits upkeep service to stay in compliance with existing tax laws, regulations and ever-changing policies. Integrated financial software also supports tax compliance with employee benefit packages. Utilizing financial software to aid in providing tax documentation will help buyers verify compliance and assess liabilities. 

Buyers will want information showing that Accounts Payable and Receiveable are reconciled. Financial software supports making sure that invoices are entered into an integrated accounting management system. Before sharing documents with buyers, a business owner can use the software to double-check that invoices, payments and voids are up to date.

Evaluating a brand image

Showcasing a positive brand image can reinforce that a business is successful. Operational details that show that a company is properly managed and running smoothly will support a business sale by making it more attractive to buyers.

With operational tools in industry software, business owners can utilize quality assurance and inspection features to evaluate processes. In particular, buyers will want to know about tasks outlined in contractual obligations. A software solution specializing in optimization and efficiency can help business owners examine service completions, performance metrics, inventory levels, routes taken and job durations. 

After compiling a range of operation data, a business owner can highlight how this information has promoted operational efficiency. Outline how processes have been made more efficient and potential risks mitigated. 

While evaluating a company brand, buyers will want workforce details concerning the roles and responsibilities of employees. For example, buyers may request organizational charts, information on top performers and details about the responsibilities of supervisors. Information on how software ensures the right person is always on-site can project a positive brand image. 

Selling a business with TEAM Software

Reasons for cleaning and security business owners to sell their companies will vary. However, there are consistencies when it comes to earning the most profit from a sale. Before selling a business, focusing on how the buyer will review the company can help maximize its value. 

Security and cleaning professionals can stay prepared for a potential buyer. Reporting and record-keeping tools available in integrated workforce management software can aid in this process. For more information on TEAM Software solutions, schedule a time to speak with one of our experts.