Reasons why people sell their businesses.
There are numerous reasons why people want to sell their business. Sometimes the true reason is not clear, but we will discuss some underlying factors that influence a business owner to sell.
- An overworked owner who has worked for years in his business without a break can reach a stage where fatigue can influence his/her decision to sell.
- The owner has too many business responsibilities or can not cope with more than one business.
- Business owners can find that the business he concentrates on performs beter than the business he spends less time with and visa versa.
- Cash flow is the major player in business success. If the cash flow of a business is negatively influenced the owner might be forced to sell a perfectly profitable business.
- A business that expands too rapidly can consume all the available cash and force the owner to sell.
- The economic climate is right to sell the business.
- The owner has reached retirement age and wish to call it a day.
- Ill health of the seller.
- Death of the owner or spouse.
- The seller is emigrating.
- The seller can not handle the responsibility of operating his/her own business.
- The seller can not operate on his/her own outside a formal corporate structure.
- The business is running at a loss. This can be due to poor management practices. A new competent owner can revitalize the business.
- Alcohol abuse has been reported in a liquor related business. The owner`s drinking habits will influence his management style and business decisions.
- Some business owners bought the business for the wrong reasons and find that the business does not meet their expectations.
- The partnership is failing. One or more partners of the business wish to withdraw from the partnership.
- Personal financial reasons of the owner.
From experience we have learned that the business owner plays a major roll in establishing the success of a business. A business that has failed can be taken over by the new owner and made very successful. The opposite is also true. Therefore is some cases the true reason for selling may never be established.
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