If you're planning to sell your business, the right preparation can significantly increase its value. Here are five key strategies to enhance your company’s worth before putting it on the market.

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1. Strengthen Your Financials

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Buyers want businesses with stable revenue, strong profit margins, and clean financial records. Ensure your books are accurate, reduce unnecessary expenses, and demonstrate consistent growth in revenue, EBITDA, and profit margins.

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2. Build Recurring Revenue Streams

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Businesses with predictable, recurring revenue – such as subscription models or long-term contracts – are more attractive to buyers. If possible, shift toward revenue streams that provide stability and reduce risk.

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3. Reduce Owner Dependence

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A business that relies too heavily on the owner can be risky for buyers. Strengthen your management team, document processes, and ensure the business can run smoothly without you.

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4. Enhance Your Competitive Advantage

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Identify what makes your business stand out and reinforce those strengths. Whether it's proprietary technology, exclusive supplier relationships, or a strong brand, emphasizing your competitive edge can boost valuation.

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5. Prepare and Track Budgets and Forecast

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Businesses that routinely prepare budgets and forecasts and track their performance against projected metrics evoke confidence in forecast financial results, which in turn can factor more heavily into the business valuation and warrant smaller risk adjustments.

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6. Assemble Your Advisory Team

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Consult with your existing advisors and bring on new advisors, as needed, early on. Meet with transaction advisors, tax attorneys, estate planning attorneys, CPAs, and valuation professionals to uncover potential gaps, risks and opportunities you might be missing. Once you assemble your advisory team, introduce them to each other to ensure their work is consistent with your goals and no details are overlooked.

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Final Thoughts

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The steps you take before selling can have a major impact on your final sale price and the overall outcome of the transaction. By improving financials, building recurring revenue,  reducing risks, and involving experienced advisors, you can position your business for maximum value.