Running a bed and breakfast is something that takes a lot of hard work and, in order to run one successfully, you need a specific skill set. It takes a completely different skill set to be able to sell a B&B.
There are, however, a few things that you can keep in mind that will help to get the process to go smoothly.
Knowing when to sell
Getting to the point where your B&B is ready to sell takes a while. You should keep this in mind when you are deciding when the right time to sell will be. It will usually take about two years from deciding that you want to sell to when the sale is finalised.
If you want to try and get the best price for your business, you should aim to sell when you are able to show that it is profitable. Selling when your B&B is failing will mean a much lower price.
It is easy to get your business and personal finances mixed up when you live on the same premises that you work. Separating these is imperative if you are going to get a good price for your B&B and, in that way, knowing when to sell your business will also depend on how long it takes you to make sure that the business finances are in order.
Preparing for Sale
Once you have managed to separate your personal finances from the businesses and you have assessed that, according to the market, this would be a good time to sell, you will need to prepare your business for sale.
There are a few things that you can do during this preparation that can help to entice interested buyers that won’t end up costing you too much money.
You can turn your mind to general maintenance that you have, perhaps, let fall by the wayside. Painting the walls and updating smaller fixtures that do not necessarily cost you too much money.
Keep a close eye on finances and make sure that you have a meticulous record of the number of customers that come and go. It will also be valuable to keep note of what seasons are your busiest and when you are quiet so that you can pass this information on to potential buyers.
You should also prepare for the due diligence that the buyer will do before purchasing your B&B. Preparing for this means taking note of any irregularities or red flags that could put the buyer off.
If you spot these early you can address them by fixing them or you can present them to the buyer along with an explanation rather than let them get think that you were trying to hide them.
Valuation of your B&B
If you’re trying to value your business, there are a lot of things to keep in mind if you are going to be able to come up with an accurate figure.
The value of the property is only one of the factors that will go into the final price tag that you come up with. The other things to consider would be the inventory that goes along with the B&B. This could be furniture, bedding, cutlery or any of the other things that are necessary to running a B&B.
The more difficult side of the valuation is trying to decide on how to value the goodwill that you have built up over the years.
This process can become very difficult. You will need to do a lot of research and see what other, similar B&Bs have been selling for and, as a fail-safe option, you should get the advice of an accountant or lawyer who has experience in this particular field.
Should you use a business broker?
You could be tempted to go it alone when selling your business but keep in mind that there are a lot of things that can go wrong and, sometimes,
If you are going to choose a broker, you will need to find someone who has a good record and qualifications who you can trust. Make sure that they have experience with businesses like B&Bs because these can be very different to sell than other businesses.
Selling your B&B can be a stressful time but, approaching the sale methodically and advertising in a way that will attract a number of buyers will put you in a good position for the sale.