As a business owner, many responsibilities fall on your shoulders – and one that may have come onto the horizon recently is the idea of selling your company.

There could be a whole array of reasons you are considering this move; retirement, family responsibilities, and favourable market conditions may all play a role. Whatever the circumstances, if you’re beginning to look at the prospect of a sale more seriously, you may be asking yourself, “When is the right time to sell?”

Ultimately, the answer to this question is unique to you – but in our experience, there are some factors to consider that could help you on your path to determining an appropriate time.

Here are four aspects that could influence the timing of a business sale.

1. Your age

In Ireland, more than 1,000 people retire from the workforce every week, according to Retirement Life’s ‘Retirement In Ireland Report 2022’.

Naturally, as you age, you may begin to think in greater detail about when and how you’d like to retire. For business owners, these plans are even more pressing; after all, you may be relying on the sale of a business to fund part or all of your retirement (more on this later in the article).

Even if you’re one of the world’s “neveretirees” – someone who doesn’t like the idea of retiring and wishes to keep going as long as they can – that doesn’t mean that you should shun any plans relating to selling your company. Sadly, ill-health may become more likely as you get older, so having a plan in place for when and how you’d like to sell your business, if the time comes, is important.

All this to say, your age may be a fundamental factor when trying to time a business sale. Organising and orchestrating a sale when you’re still fit and healthy could be constructive, as this process may be lengthy and could incur some stress too.

2. Priorities outside of work

Although running a business can be an all-encompassing lifestyle, it is likely that you have other priorities that become increasingly important as you get older. These may include:

• Family commitments, including caring for grandchildren or elderly loved ones
• Mental or physical health needs, which may require you to rest more frequently
• Travel and other lifestyle goals.

If you find that on a personal level you are ready to move on to the next chapter of your life, this could nudge you towards making plans to sell your company.

As with the previous point about your age, it could be prudent to begin preparing your business for a sale early, even if you aren’t planning to give up work just yet. Some personal priorities can come up without warning, so knowing that your company is well-prepared for you to take a back seat or sell up altogether could bring you peace of mind.

3. How well your business is positioned for a sale

On the corporate side of things, one question to ask yourself might be: “How does my business look to potential buyers?”

There are a multitude of factors to prepare for and think about here, such as:

• Your company’s financial situation, including revenue, debts, and staff numbers
• The trajectory of your business’s success since its inception, as well as future projections
• The wider market conditions within your sector
• How well your team might transition into operating under new ownership, and if you may expect to lose some of your workforce in the move
• The type of business that is likely to acquire companies like yours.

Considering these options well ahead of time, and getting to know the market within your specific sector as early as you can, might help here.

If your business needs to undergo some internal improvements, leaving yourself plenty of time to bring everything up to scratch could help you time the sale favourably and perhaps earn you a more lucrative sum.

4. Your personal finances

Of course, your personal wealth will play a big part in deciding when to sell your business.

If you plan to retire in the next five years, for example, you might feel it is appropriate to sell your company in time for this, as you may wish to use the funds to provide for yourself and your loved ones.

An additional factor to consider here is your tax situation. Your personal tax bill is likely to rise when you sell your company. Ensuring you’ve taken the time to plan this out with a tax adviser, and have spoken to a financial planner too, could be highly beneficial.

As such, it may work in your favour to begin planning for the sale of a business around five years in advance. There will never be a perfect time to sell, but preparing over this generous time frame might help the stars align in your favour.

A financial planner can help manage your personal finances before and after the sale of your company

Selling your company may be the biggest capital event of your life, and managing your personal finances throughout the process is essential to your future financial stability.

Here at iQ Financial, we can create a bespoke financial plan that factors in the sale of your business across a time frame that suits your goals. We’re here to help you manage your finances after the sale has gone through, too, so you can look ahead to a prosperous future alongside your family.

To learn more, email us at clients@iqf.ie, or call 353 71 915 5560.

Please note

This article is for information only. It does not constitute advice.

It describes financial planning services that iQ Financial can offer to you. Financial planning services are not regulated by the Central Bank of Ireland.

iQ Financial is not a tax adviser and tax advisory services are not regulated by the Central Bank of Ireland.