What are the top five ways to get your business in tip top condition before selling?
Answered by Anthony Windress from Commonwealth Bank of Australia
- Strip out extra costs. Take a critical look at expenses – especially if the business is paying for optional extras, such as your car. If possible, take those costs out of the business at least one financial year before you sell, so that you have a full year’s accounts showing the full underlying profit of the franchise
- Get sales pumping. It’s always better to sell when revenue is increasing. Six months before you list your franchise for sale, start increasing your marketing spend. This may help to generate a rise in sales
- Put it in writing. No doubt your franchisor has welldocumented processes for your main business systems – but there are also all of the little things you do to keep your business running smoothly from day to day. By putting that knowledge down on paper, you can reassure potential buyers that they have everything they need to make the business work.
- Fine tune your finances. Establish cash reserves or settled lines of credit, so that you can offer purchasers a financially strong business. Write off any bad debts, pay any outstanding bills, and chase up overdue accounts
- Renovate your assets. Ensure that your plant and equipment are up-to-date, well maintained and well documented. Now is the time to take care of all those minor repairs you’ve been putting off
About Anthony Windress
The financial needs of your Franchise business are unique. That’s why the Commonwealth Bank offers you the specialised services of our Franchise Banking team. Our team members are industry experts who can tailor financial solutions to help you – whether you're buying a franchise or running a multi-site corporate.
You should always check independently that an ask an expert answer published on Franchise Business applies to your particular circumstances.
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