If you are a printing business owner, chances are that your business is one of your largest personal assets. You may even have more funds invested in your business than you have invested in your family home. With this in mind, it is important to try and maximise the price you can get for your business when you do eventually decide to exit. Part of maximising the price involves selling at the right time. When, however, is the right time?

The consensus among business brokers is that a typical business owner holds on to their investment for between three and five years. As a business broker specialising in the printing industry, however, I see a completely different picture. By the time a printing business owner calls up to discuss selling, they have usually owned and run their business for 10-40 years. Often they have spent almost their entire working lives in their enterprise.

Getting emotional
Having owned their business for such a long period of time, the idea of selling can be very emotional for a seller. The business owner often feels anxiety about what they will do after the sale. Will they retire or will they move on to work as an employee, possibly with the new owner? How will they cope with working for someone else, particularly someone running the business they used to own?

Some business owners think of selling as a means of getting out while things are not going well. One business owner recently approached me saying that his business had been struggling financially for some time. During this period, he had thought about selling often, but had repeatedly made the decision to hang on to the business. He had done so in the hope that circumstances would change. He said that he now realised that he was gambling and it was time to put a stop to it.

For those business owners waiting for the market to be at its peak, it is interesting to think about a comment by Rene Rivkin some years ago. He said: “You will never pick the top or the bottom and if you did, you were merely lucky.” Rather than trying to time the market, it is far better to carefully plan for the sale around your own life plans.

Starting point
Ideally a business owner should start planning two to three years before the intended sale. A good starting point would be to consult with an accountant and a business broker. They may be able to give an initial indication of likely selling price and what you can work on to increase it.

Also, they may be able to provide some guidance on how to boost the attractiveness of the business to potential buyers. If possible, choose advisors who have had some exposure to the printing industry.

Well, back to that question. When is the right time to sell? The right time to sell is at the time you planned to sell.

With your carefully constructed plan in place, your business will be fully prepared for the market. Also, your chances of selling close to the time of your choosing and at the best possible price will be strongly improved.

David Ferraz is a licensed business agent at Cornerstone Business Sales and Valuations, specialising in the sale of printing businesses.

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