SCORE column: Small business value drivers | Brainerd Dispatch

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The baby boomers are experiencing this now. There will be three options from which the owner might choose. These are: 1. Transfer ownership to the family, 2. Close the door, sell the assets, pay off the debts, or,

3. Sell the business to employees or outside buyers. I have seen estimates that the third option will be the choice of more than 60% of the owners leaving the business. After all the hard work and commitment you have made, you deserve a maximum return. I would like to share some thoughts on what potential buyers will think most important. Potential buyers will want to see at least the last three years of your financial statements. They should be prepared by an outside CPA firm. This will give credibility to the numbers. Has there been a pattern of consistent growth in both revenue and net income? Annual growth of 15% in both Revenue and Operating Profit makes a company very attractive to investors. I have worked for a company that hit those targets and the owners became very wealthy. It can be done.

Has your company had income gains from economies of scale? What has been the trend of the Gross Margin and Operating Income over …

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