How to know when its time to sell your business

If there is one thing that is essential to running a small business, it's passion.

It is what will get you through the long shifts, the unpaid hours, the frustration, and the doubt. Passion is what makes you love what you do, and wouldn't trade it for anything.

So what happens with the passion disappears?

Part of being a successful businessperson is knowing when to stay, and when to walk away. Chances are, you're going to own and manage several businesses in your lifetime - so learning to sell up and move on is crucial.

We spoke with hospitality industry expert Ken Burgin about the signs that could indicate it's time to move on. So if you've been thinking about selling up but can't be sure that's what you want, take a look at our points below.

1. Money has become your sole focus

“For me, the number one reason that people get out of their business is money,” says Ken. “The money is disappointing, or they’re not making enough - and when there’s no money, it's the only thing you’re thinking about!”

Of course, all small businesses will experience tough times financially. However, with the right amount of passion and clever thinking, money issues can sometimes be overcome. But once your money woes become the driving force behind why you go to work each day, the love is lost, and it’s time to move on.

Ken also points to a slowing down or neglect of financial management as a red flag for business owners: taking extended periods to pay your bills, or forgetting to pay staff are good indicators you’ve lost your attention.

2. You don't want to go to work

This is the first and most obvious sign. On the mornings where you used to leap out of bed to get into work and start serving customers, a hesitance to go in is a great indicator the passion has gone. Motivational speaker Earl Nightingale points out that the impetus to work must come from within.

"The biggest mistake that you can make is to believe that you are working for somebody else," he says. "The driving force of a career must come from the individual." Remember: jobs are owned by the company, you own your career!

3. You are no longer the leader of the business

“The business owner needs to shine the brightest when it comes to motivating and inspiring their staff,” says Ken, “and it’s really obvious when they have checked out.”

Your attitude as a business owner has a flow on effect to your staff, the energy of the venue, and your customer experience. Once that responsibility gets passed on - either consciously or unconsciously - to another member of the business, the wheels will start to fall off. So, if you no longer have the desire to lead your team, it might be time to leave.

4. You have lost interest in the success or future of your venue

If you are wondering if your interest in the business is waning, you need to look no further than your bottom line. When profits begin to dwindle, it may mean you have taken your foot off the pedal, which becomes an urgent reminder that it is time to move on.

“A lot of people seem to just sit back and wait for things to improve without doing anything,” says Ken, “and hope that they will suddenly be ‘discovered’.” Once you stop fighting to be noticed, then chances are you will be quickly forgotten.

Small business requires constant attention. It's hard work and long hours, constant review of staff, produce, overheads, and improvement. Let that slide and your profits will suffer. Get out before it starts costing you serious money.

5. You’ve cut down on ‘non-essentials’ - and business is suffering

With money taking centre stage, business owners can start cutting out ‘non-essential’ items like advertising, or the staff Christmas party. Whilst seemingly unworthy of the limited budget, these are the things that keep a business together.

This extends to the aesthetics of the venue, which Ken calls ‘quality items’ - that is, the little things that make a big difference to how your venue is perceived.

Ken uses the example of dead plants. When things are going well, and you’re invested in your business, buying and maintaining fresh flowers isn’t a difficult task. But once you notice dead plants in the venue and don’t really care? It’s time to leave.

6. Your staff are unhappy

As you well know, there is so much more to a business that money and product - it also hinges on the people. If you are unhappy, and your staff are unhappy, the business will suffer.

“One clear sign that you should sell is really high staff turnover,” says Ken. “Your staff want to work somewhere positive, exciting, where they are paid on time. If not, they will want to leave.”

Rudeness, laziness, defiance, and lack of loyalty are all side-effects of having poor management, and trust us when we say your staff will notice when you lose interest in the business. You won't be as present as you should be, nor will you be behaving as a leader should. Think about it: are you happy to take down other people along with your own business?

Knowing when to sell up and move on is a strength of a business owner. We are taught that ‘sticking in there’ and ‘not giving up’ is the right way to handle small business, when in fact it can be recognising the opportunity to leave that is far more empowering.

You only have one chance to sell your business when moving on, so avoid driving it into the ground, and you’ll be closer to getting the price you want.