HOW TO PREPARE YOUR COMPANY FOR SALE
Where do we stand today? What is our potential?
As we work into the summer of 2020, landscaping companies are working, but they are also re-evaluating their life and their business plans. Ideally, owners and senior managers would keep an eye on their long-term goals for the company, which may include selling. I thought it might be helpful to provide this summary for reference.
Perform a SWOT analysis. How does your company perform on these indicators?
- Record today’s results.
- Set your goals and action plans for improvement.
Measure what you want to achieve.
1.) Sales/Growing Market/Brand
- Low level of concentration in customer base
- Long-term client relationships with good quality companies
- Easily transferable client contracts
- Effective salesforce
- Great brand-reputation for quality work, position in market
2.) Management Team/Leadership/Low Reliance on Owner
- Company runs well without the owner
- Capable management team able to plan and execute into the future
- Leadership in top management
3.) Excellent People, HR
- Excellent morale and good hiring practices
- Stable, well-trained workforce with perfect i-9s
- Appropriate training including safety/certifications
- Proper employee handbook
- Great organizational structure – good span of control
4) Potential/Future Growth/Strategy
- Potential for future growth
- Strategy to enter new markets/bring new services to existing clients
5.) Effective Operations/Great Central Location/Equipment, Fleet
- Efficient, effective operations
- Best practice workflow processes
- Up-to-date fleet, equipment, tools
- IT and computing systems
6.)No Problems/No Surprises
- No legal issues, no environmental, personnel or other risks
- No clients about to leave that you weren’t aware of
- No employees about to leave
7.) Strong Financials
- Sound fundamentals and positive trends
- Net Profit
- Gross Margin
- Predictable recurring revenue*
- No consecutive losses
- Good credit
- Strong cash flow
Prepare yourself for the sale of your company.
- Do you know what your company’s most likely price would be?
- What about taxes?
- What are your retirement plans?
- What are your financial needs after the sale?
- Do you want to be involved with the company after you sell?
Your personal financial planner/tax advisor is an important participant in this process.
As always, if you would like to have a confidential conversation about your situation, please feel free to give me a call or email. Alison Hoffman 224-688-8838 [email protected]