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Selling in a Growing Market - Four Advantages to Selling Your Business When the Market is Hot

Whether you’re set on selling your business or you’re still considering the option, it’s important to research the current market and its state. First, you’ll have to discover if your business’ purpose — precisely what it does — is unique and whether or not there’s a current need or demand for the services your business provides. Next, you can consider what else is on offer in the market. To get an idea of the current crop of competition, you can consult resources such as Statistics New Zealand’s data for business page which outlines helpful statistics based on the target market and industry.

If the current market in your industry is active, there are many advantages to selling when the market is ripe. A large pool of interested buyers and a need for the services your business offers equates to a favorable environment for selling. What follows are four advantages to selling your business when the market is hot.

Increase in Competition

High demand and lots of competition among those interested in purchasing your business is naturally going to drive up the price for a sale. Trends in your specific industry will influence it as well and, if it’s a hot market, you may end up with a quick sale that works to your advantage and generates liquidity for you.

Competition also helps draw out the best prospects. In a hot seller’s market, qualified buyers are going to be searching actively for opportunities. When you use the services of a business broker, such as LINK, the broker can devise strategies for reaching a big pool of potential buyers.

Gives You the Upper Hand

If the market’s hot and you’ve got lots of interested parties, it means you can dictate the terms of the sale. Knowing your competition and being aware of current trends will help you defend your asking price to potential buyers. You’ll want to be sure to price it competitively in an active market, but not too low or too high. Too low and the sale won’t be nearly as profitable as it could have been and a price that’s too high will likely drive away other potential buyers because they’ll see it as overpriced or overvalued.

Time to Prepare

In an active market you can often take your time knowing that you'll have many potential buyers. You’ll have to know your numbers backward and forwards as well as be on top of your financials and assets, so take the time to prepare accordingly for the final transaction. Keep in mind that you still have to run your company up until the time it finally sells so you can hand it over in a good state.

Marketing Practically Writes Itself

In an active market you won’t have to wonder whether anyone will buy your business. A business that’s well established, profitable and has been well-managed over the years will not have a hard time selling in an industry where the market is active. A business broker can also assist with completing marketing research for your company as they understand the big picture in your company’s specific industry. In this way, they can create a marketing image for your company that’s appealing enough to encourage potential buyers.

If you’re on the fence about making the move towards selling your business, consider consulting a business broker for advice. If you’re looking for an exit in a hot market, it may be a smart move.


For further information about this article, contact your nearest LINK Business Broking office at: