Why Earnings Are Critical To The Sale Of Your Business

Why Earnings Are Critical To The Sale Of Your Business

Decision Associates M & A understands why earnings are critical to the sale of your business. We can help you assess your earnings position and establish a pathway to prepare your business for sale.

Upside of strong earnings

  • Makes your business bankable; you receive favorable interest rates and covenants
  • May avoid personal guarantees
  • Provides resources for reinvestment from self-financing or favorable bank financing
  • Better ability to provide income and benefits to retain and attract good employees
  • Able to satisfy large customers who evaluate vendors’ financial stability
  • Increases potential sale price to third
  • If selling to children or employees, makes it bankable and provides a very stable starting point

Downside of weak earnings

  • Reverse of all the above
  • 85% of potential buyers will not even look
  • 15% of buyers will be interested in assets or customers
  • Minimal price

For a deeper understanding of the importance of earning, contact Decision Associates M&A.

"On both a professional and personal level, my Decision Associates Peer Group was a life-changing experience. I forged relationships with other group members that continue today. With Don Moore's insight and guidance, we shared challenges, learned from each other, held each other accountable, and returned to our respective organizations as better leaders. It may have been the single most important process in helping me become a better leader."

~ John Weber, President
Smith Provision Co., Inc.

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