Years 2018 and 2019 may be ideal times to sell your Houston business. Values have never been higher, particularly for well-run companies. We’re also beginning an upswing in economic cycles. That’s the ideal time to sell a business.  It won’t last forever, so if you’re contemplating an exit, 2018 may be the best time to sell your business in Houston.

Ultimately, however, the value of your business depends on the risks and benefits buyers perceive, regardless of the market. This means there are always things you can do to increase value. A handful of major factors drive value, and vary from industry to industry. Here are the ones you need to focus on to get top dollar:

  • A history of increasing revenues and profits: This is the number one value driver. Buyers want to make money. They will examine past financials to get a feel for how things may go in the future. Steady increases bode well.
  • A strategic plan that demonstrates strong organic and inorganic growth: The plan must demonstrate a competitive advantage within a growing industry. If your company can serve multiple industries, that’s even better. 
  • Future cash flow: The buyer will look at expected EBITDA performance, expected capital expenditures, and expected working capital investment requirements. The higher the expected future EBITDA, the higher the company’s value will be. Likewise, lower expected capital and working capital investments equate to a higher value. 
  • Strong management: Bench strength matters. Owners should ultimately try to work themselves out of a job. When a business is dependent on a single owner or a handful of key players, that means buyers face greater risk. The adjustment period can be more difficult. So strengthen an already strong team, or put a new one in place.