Signs That Tell You It’s Time To Sell Your Online Business

Billy BeardBlog, Business, Ecommerce1 Comment

In accounting, you may have encountered the going-concern concept or assumption where a certain business is assumed to operate perpetually.  That assumption is valuable to the generally accepted accounting principles where we talk of prepayments, accruals, depreciation and amortization.  We value our assets based on historical cost and recording them under the long-term category. If there is no going-concern concept then the accounting approach would be that of a liquidation.  

In starting an online business or business in general, that same concept is applied.  You do not build a business for the sole purpose of selling it after. Although that could maybe be the purpose of other entrepreneurs.  But for serious online business owners like you, there is a conscious effort to grow and even expand your business. You would have never thought of starting one and end up as a business failure

Can you sell your online business?

Mergers and acquisitions are business jargon or legal terms that you might have thought to exist only with companies or businesses offline.  However, these transactions also happen online. If at first you think that your online business will just dwindle until the time you say stop, there is actually a way to do a graceful exit – can be a profitable one, at that.  In fact, many brokers, particularly Amazon FBA brokers, have emerged and they can help you in ensuring the smooth flow of transaction should you decide to sell your business.

When can you say it’s time to sell?

With the buying and selling of online businesses happening left and right, then selling would be a more practical direction for your business instead of just stopping abruptly.  This could be the graceful exit that you can do. But, why exit? Or, what may lead you to decide to stop your online business?

Here are some reasons we have gathered that can very well be the signs that will tell you that it’s time to sell your business:

1. Fading passion for your business

The reasons why your passion for your business fades can stem from many things. It could well be a result of getting burned out with the increasing pressure or demands for your time and effort. Or, your business growth may have reached a plateau and you don’t seem to have the motivation to get everything going.

Remember, if you, the business owner, lacks the interest to work, that vibe will trickle down to your people decreasing their productivity that will have a negative impact on your bottom line. With this to handle, you get more burned out and drive your passion down to zero then it will be a vicious cycle from there. You wouldn’t want to end up bankrupt and having people lose their jobs just because you lost the will to continue.

If you feel that you do not have the overflowing passion and intense drive to move forward like the time you first started, then maybe it’s time to sell your business and start a new one. This change of business direction where you can start with a clean slate might be the thing that can fuel or rekindle the passion that you think you have lost. You can also use the proceeds of the sale as an equity to your new business.

2. Change in life priorities

To sustain, grow and expand your business will take much of your time and effort.  If you are bent on building your own empire then you have to make your business, your priority.  You might be one of those embracing the hustle culture where you channel most of your time and effort into your business.  Losing sleep might not be too much of a problem because you are after all, earning from all your hard work. But while your business is a priority, it’s not your only priority. 

There might be life-altering events or circumstances that can make shifting your priorities a necessity.  Topping the list would be family. While working too hard on your business can help you provide more for your family, they need more of you – your time and your presence, most especially.  Or, you might have encountered a health scare that made you realize that you need to slow down, rest and look after your health too. Maybe, you have some family financial dilemma that you need to address.  These and more can make you rethink your life priorities. And, if your business ceases to be on the top of your list, then it’s time to sell it.

3. There is a high-profit offer

If you have built your business to a high-value level, all the more it becomes enticing to investors.  Rather than build a business from scratch, a lot will just acquire one that’s already generating high-figure income.  It may entail higher upfront cost for the buyer but that will not be your concern anymore. Maybe they deem the move less risky and your business, worth investing in.  

Of course you would think, if your business is really doing well, why sell?  Then again, if the offer is manyfold of what you estimated the value of your business is, why not sell?  You can consult or have your business valued by brokers or any other firms just so you will have an idea on how much your business is worth.  So, if the price is right, go.

4. Drastic changes in the industry

Industry changes can come in the form of sales trend, shift in customer preference, economic downturn, imposition or amendments of trade regulations and government legislation,supplier limitations and much more.  Remember the ongoing US-China trade war or changes in India’s eCommerce guidelines and policies? These are just some of the industry changes that will require a drastic measure to ensure that your business can thrive despite.

While industry changes can be addressed, although not easily, the question is are you still willing to take the burden of coming up with your strategies to cushion any negative impact to your business?  If you are not, then others might probably be.    

5. Business has outgrown your skills

To address drastic changes in the industry that you are in, as discussed above, you have to get your skills into action.  As your business grows, it might require a higher skill set from you and from your employees. To do that, you must continue to learn and develop new skills.  You have to be on the lookout for new developments in the industry, the products, new innovations, that you have to learn and be updated with.

But, what if you lost that will to learn and expand your knowledge?  If you refuse to adapt to the changes of the business environment that you are in, eventually you will find that even if your business grows at a faster pace, you will fail to deliver the things that it demands.  This is a clear scenario that your business has outgrown you. Maybe, it needs a new owner that’s more than willing to grow the business at the same pace.

6. No financial capacity to expand

To ride on the many opportunities of making your business go global, expansion is key.  The eCommerce environment right now is one where you can easily expand your marketplace since everything is done online.  Unless you just want to go through the motions and keep your business at a stagnant position, you would most definitely try to expand.

But expansion, while online, would still have financial considerations and requirements.  You need to invest or add equity to your business. You could incur extraordinary or non-recurring expenses that would hurt your finances if done upfront.  It would be good if you can get financing from banks or other financial institutions. But what if you can’t? 

Even if you still have the passion, or your sales are still going well but if you do not have the capacity to pour in more capital to expand, then maybe it’s time to sell your business.

7. Retirement

Who wants to be working all their life?  No one, for sure. Most business owners have already set their retirement age and at some point may have already thought of retiring from business, in general.  There are those who are very much looking forward to a stress-free and relaxed life and if all that comes into play, then retirement is the way to go.

If you are one of those people that are retiring soon, selling your business may be a practical move.  The proceeds from the sale can actually fund your retirement. And, if you have grown your business and its value of high-figures, certainly it would be priced higher.  

Who decides on the best time to sell?

You cannot say for sure when the perfect time to sell your business is.  There are however brokers that can be consulted and can recommend if it’s a sell or not.  But the ultimate decision lies on you, as the business owner.

The signs above are provided to guide you in assessing whether it is still in your best interest or your business’, as a whole, to continue or to sell it and have someone who is more capable and more interested to keep your business a going-concern, take over.

If you can think of more signs that will tell you it’s time to sell your online business, please do comment below to share to the community. 

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One Comment on “Signs That Tell You It’s Time To Sell Your Online Business”

  1. Pingback: What is a Business Exit Plan and Why Develop it at Day One?

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