Challenge
Preparing for a sale of an agency within a short timeframe requires a thorough, but rapid, assessment followed by immediate strategic planning and preparation of key information for presentation to buyers that can maximise the outcome.
Many agencies start an exit process with a short-term goal but are not adequately prepared for a successful exit or what might be required after.
If you think you’re ready to go for it in the next 12 months, then ask yourself these questions:
| Question | Why it’s important |
|---|---|
| Are you planning to sell your business within the next 12 months? | Early planning is crucial for a successful exit. It allows time to prepare the business and maximise its value. Are you ready? Do you know what you need to do to be ready? Who would be your buyers, what will they be looking for and what will you need to present to attract them? |
| Do you understand the exit options you could achieve? | Understanding exit options helps to make informed decisions when choosing the best path forward. As previously said, there are many options, but the list is more limited when time is short. |
| Do you have a sellable business, plan and leadership team? | A strong plan and leadership team are essential for executing a successful exit strategy. Again, this is critical if you want to maximise value. The right people with the right plan and in the right business is what people will pay for. |
| What is your target valuation – is it realistic? | Having a realistic valuation ensures that you set achievable goals and expectations for the sale. What is your agency worth and who sets that value? What could increase it and what could diminish it? Even if you’ve found a buyer, how would that value move to the shareholders and over what period of time. All very important considerations that need to be managed by an expert. |
| What preparation needs to be done to get you ready? | Proper preparation is key to maximising the value of the business and ensuring a smooth transition. Experts in this area know what to do and what to avoid. It isn’t their first sale process so they have a blueprint and know what different segments of the buyer landscape will want. |
| Is now the right time? | Timing is critical for a successful exit. Early planning ensures that you are prepared when the right opportunity arises. You can’t be certain that just because you want a deal there is one out there for you. You might need to double down for a while and wait until the markets are ready for you. |
Solution
Conduct an exit readiness assessment to evaluate your business’s sellability. Ensure you have a realistic valuation based on the prevailing market norm for your discipline and then maximise it through careful presentation and deal management working with your expert advisory team. Address any gaps or weaknesses to maximise your exit value.
Why it’s essential
Owners often decide to sell when they are not ready, this is largely because they don’t fully appreciate what being ready is. This can lead to them testing the market with the wrong approach and not presenting themselves in the right way, therefore undervaluing themselves. Owners can spend a great deal of time and money chasing wild geese, which almost always diverts them from running their business, adding more risk and resulting in a lower trading performance.
An exit readiness assessment ensures that the business is prepared for a successful sale. It helps to identify and address any weaknesses, ensuring that the business is attractive to potential buyers and can achieve a high valuation.
Waypoint can help you
Waypoint buy and sell agencies all the time, we know what will and won’t sell. We know what buyers want and how to shape and present an agency to ensure a deal completes. We can save you a lot of time and money by guiding you through the process and helping you achieve your best possible outcome.
