Simple Tips To Successfully Sell Your Family Business

Successful family owned medium sized businesses are often a labour of love, built up over many years of blood, sweat and tears. However selling a business is foreign to most owners, and so it makes sense to do some homework and be well prepared.

We provide some tips to help you to maximise the value of all your hard work.


Your first step should be to engage an expert adviser to assist you with the sale. When selecting an adviser, consider these questions

1) Does the adviser have experience and a demonstrable track record in similar business sales?
2) Is the adviser appropriately qualified (for example holding a business or accounting qualification)?
3) How is the adviser compensated? Is the adviser incentivised to achieve the best possible sales outcome?
4) Does the adviser work proactively, for example by reaching out to prospective acquirers (rather than simply posting an advertisement on a website)?
5) Do you feel comfortable and confident with the adviser on a personal level?


Understandably, some business owners may have an unrealistic view of the value of their business. It is important to get an unemotional and objective fair market opinion.

The sale value of a business is broadly driven by two key factors – the profit being generated by the business, and comparable prices being paid for similar businesses. These comparable prices are usually expressed as a multiple of profits which is often determined by the overall state of the economy and your industry. Your adviser should provide an objective valuation and an indicative sale price range.

You must be entirely comfortable and willing to proceed with a sale based on an objective, unbiased valuation – if not, don’t go ahead. It will only result in both you and your advisor becoming very frustrated with the process and not making any headway.


Early preparation is the key to maximising the value of your business. You may wish to think about these key elements:

1) Is the business reliant on the skills and expertise of a single owner? Consider “locking in” the key managers in the business, and providing them with the skills and responsibility to successfully manage the business under new ownership.
2) Ensure that, to the extent possible, the financial accounts of the business are “clean” – minimise Directors / Shareholder loans, resolve outstanding claims or outstandings (ie PAYG, Super, GST etc), write off obsolete stock, remove unnecessary subsidiaries or corporate structures.
3) Ensure that licenses, franchise agreements, supply agreements etc are up to date. If possible lock in long term revenue contracts and agreements.
4) Diversify your customer base. Try not to have a meaningful percentage of your revenue to any one customer.

Selling a business is often one of the most important decisions you can make, so engage with a professional, understand the value of your business and start preparing early – these basic steps will help you achieve the best possible sale price.

So what do you see in the market? I’d love to hear your thoughts on the biggest roadblocks you see to successfully selling a family owned business.