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Why Do Private Company Owners Sell Their Businesses?

Not Always in the Autumn of Life

Not Always in the Autumn of Life

Private company owners have a broad range of motivations for selling their businesses. Buyers are often wary of businesses being sold when the seller is some years from normal retirement age – suspecting an ulterior motive. This might well be a mistake as there are many valid reasons why a business might be on the market.

There is a natural tendency amongst buyers to think that private companies are only sold when the owners reach retirement age. This is far from the truth. As an active business broker in the UK market we see are any number of perfectly valid reasons for owners to sell well before normal retirement age. This article explores some of the reasons we see most often.

Retirement:  Is the biggest single reason to sell but surprisingly applies to less than 50% of our transactions.

Lifestyle Change:  Divorce, new marriages, illness, job driven relocation for husband/wife and wanderlust all have been reasons to sell.

Timing:  Some entrepreneurs have a knack for recognising that their business is at the peak of its value cycle.

Entrepreneurial Drive:  Some successful entrepreneurs have a restless drive to chase the next big idea. They might build and sell several companies during their working life.

Financial Difficulties:  A bad debt or some other financial disaster can make a sale the only way to clear financial problems.

Business Life Cycle:  Growing businesses need frequent capital injections to fund expansion. Having put the house on the line once selling can seem a better choice than doing it again.

Fatigue:  Running your own business is stressful and time consuming.  Sometimes entrepreneurs just run out of energy.

 

If you are interested in finding out more about these and other issues relating to the sale of a private company one of our business sale experts would be delighted to talk to you in complete confidentiality. Click CONTACT ME to book an initial phone conversation or call us on 01604 432964.

 
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