Ride down any street in Tulsa, and chances are you’ll pass some job site. If there’s not one on the block, chances are there will be. Just look at some of the big projects coming to the Tulsa area.
Whether you’re a home builder or a general contractor, now may be the time to think about selling your building company.
In this guide to selling a construction business, we’ll tell you how to get the best return for your investment and hard work.
Some best practices when selling your business
No matter whether you’re completely getting out of the construction game or only pursuing other business opportunities, the selling process can be overwhelming.
Before you list your company for sale, follow these steps to ensure you receive the top dollar for your transaction.
Develop an Exit Strategy
Every business owner should have a well-planned exit strategy. There is no one-size-fits-all exit strategy, however. The right approach is based on your company’s size and goals for both you and the company.
When devising your exit strategy, consider the following key aspects:
- When do you plan on leaving the business?
- Are you staying as an advisor?
- Do your current employees plan on staying?
- How will the actual transfer of ownership occur?
Your exit strategy will help you stay on track in achieving your timeline and goals. By following your plan, you will ensure a seamless and profitable transaction.
A profitable business is always alluring to buyers just entering the construction industry than one that’s sinking.
There are several ways that you can increase the gross sales of your small business before its sale. No matter where your construction company is located, high-quality and quick service will make a lasting impression on its clients.
Organize Your Business Documents
Focus on organizing your books. Prospective buyers will want to see documents to show them buying your construction company is a good move for them. Some business documents that they may wish to review are:
- Proof of positive cash flow
- Bank Balance Sheets
- Income Statements
- Vendor Statements
It would be best if you considered hiring a lawyer or a business broker to help you prepare all of your paperwork.
Determine the Value of Your Business
Establishing an accurate price is perhaps the most critical step in the selling process. There are advantages to getting a professional valuation.
Consider what equipment is included in the sale, such as:
- Do tools and machinery come with the business?
- Are you transferring all of the long time standing relationships with contractors to the new owner?
A professional broker will help you select the best valuation method (gross sales, cost-to-build, income, market, asset) to give you a dollar figure to remain solid on during negotiations.
List Your Construction Company for Sale
The final step in the process of selling your construction business is to put it on the market.
Hiring a business broker can help you alleviate stress and allow you to focus on your company’s day-to-day operations while the broker takes care of marketing your sale to find qualified and strategic buyers.
If you follow these five steps in our guide to selling a construction company, your business can stand out from the other design companies, general contractors, and home improvement contractors for sale in your area.
If you’re considering selling your construction company, get in touch with Winning Hand Financial Representation Corporation, and we can show you the benefits of hiring a business broker.
We have years of experience selling construction companies and will professionally market your business and ensure that you get the most you can for your sale.