If you are thinking of selling your staging business there are FIVE key actions you need to take now to position your company for a smooth and profitable sale.
The one thing most people don’t consider is the fact that in order to sell a business you need to go back to the very beginning, the point when starting your home staging business was just a dream. You need to start by assessing the very foundation of your business.
The most successful business sales are those businesses that have a strong track record of planning, processes and procedures, record keeping, and accurate financial and accounting records. Before you put your business up for sale and announce it to the public there are steps you need to take to assure that you are selling to the right person, at the right price, with the right terms that benefit both you and the buyer, and most importantly that you have a strategic tax plan in place prior to signing the sales contract…in essence, an exit strategy.
SYSTEM 1 – PLANNING
Before you started your business, you should have created a solid business plan. The business plan is a living document that needs to be reviewed and updated on a regular basis. A business plan is a written document that describes in detail how a business defines its objectives and how it is to go about achieving its goals. A business plan lays out a written roadmap for the firm from marketing, financial, and operational standpoints. Potential buyers of your business will want to review this roadmap and assess future goals and plans.
ACTION 2 – PROCESSES & PROCEDURES
Two key components in a successful staging business are your Operations Manual and your Employee Manual. Your operations manual should outline every process and procedure that takes place in your business. It should include job descriptions and an outline of all job duties for each member of your team, including you, the owner. A potential buyer of your company should be able to open this manual and readily understand all the processes involved in operating the business.
A detailed employee manual is imperative once you begin hiring employees. Many stagers start small and don’t consider the need for employee systems and end up shooting themselves in the foot and setting themselves up for failure. Even if you are hiring family and friends for your team it is important that everyone knows their job description and expectations.
ACTION 3 – RECORD KEEPING
Another aspect of your processes and procedures relates to accurate record keeping. Your in-house accounting program (Quickbooks) should be able to generate your financial and payroll records. It is also imperative that you keep good employment records. Most importantly you need an accurate inventory control system for your furnishings and accessories. A potential buyer will want to thoroughly review all of these and the more streamlined, accurate and concise, the more appealing your company will look to the buyer.
ACTION 4 – FINANCIALS
If you aren’t already working with a professional CPA, begin doing your research and hire one NOW! When you are first starting out in business and money is tight, the accounting fees can seem enormous. It’s best to have a predetermined agreement that covers monthly meetings, quarterly reports and annual tax planning and preparation. When you decide to sell your business, you will need several years of verified financial reports. If you don’t have a strong CPA on your team from the very beginning, you can be setting yourself up for failure.
ACTION 5 – EXIT STRATEGY
If you are at the point where you are considering selling your staging business, it is important to buyers that the business can continue to run at its current levels without your continued involvement and expertise. If you haven’t already begun, you need to begin grooming a “right hand person” that knows the in’s and out’s of your company. If you are currently the “face” of your company, now is the time to begin introducing your team members to your clients, vendors and the community. This is a key factor potential buyers are looking for when considering the purchase of a business.
If you’ve been running a successful, profitable, growing staging business you most likely have already taken these 5 actions.
Prior to selling your staging company take a good, hard look at each of these areas and be sure that each area is looking its professional best. Putting the time into these areas in the front end will lead to a smoother and more profitable sale of your company.
Are you ready to sell your staging business? Join RESA for a free Professional Development Webinar on Thursday, June 24th at 1pm PST.
get the roadmap to sell your staging business
- 5 Actions To Take Now If You Want To Sell Your Staging Business - February 18, 2021
- Do You Have An Exit Strategy For Your Staging Business? - February 15, 2021
- What IWish I Knew Before Selling My Staging Business - February 6, 2021
