If you are closing a business, there are several key elements you need to follow in order to successfully close your doors. First, talk to your landlord and let them know you will be terminating your lease, speak to your utility companies and choose a disconnect date, and do not forget about asset liquidation. Liquidating assets is one of the best ways to get rid of all the excess equipment and things that you don't need and don't want to take home with you.Continue reading "Steps of asset liquidation"
Have you thought about what will happen to your small business when the time comes to close your doors or pass it along to another person? Many small business owners have the desire to pass their business on to their children or a close loved one. If you are ready to exit your business, there are multiple steps you will need to follow in order to close your doors or pass the keys to another person. Depending upon how large your small business has becomes, you will need to start the exit strategy planning process early. Some businesses take a year or more to pass the keys to a new manger while others can make the transition in just a few weeks.
When thinking about selling their company, usually the first question a businessperson asks is "How much is it worth?" Unfortunately there is no cut-and-dried answer to the question. Entire books have been written about valuation. There are so many variables involved (and many of them are very subjective) that different experts looking at the same company could end up with different selling prices. There are some commonly accepted techniques and rules of thumb used, which are presented here.
Basically, there are two major ways to figure the price of a small business. One is the company's ability to generate sales, cash flow and/or profits. The second method is to value the company based on its assets. There are additional factors that can be considered as well but most companies fall into the first two categories. Which method is used depends on the condition of the business and the industry it is in.