A turnkey business is an already well-established enterprise that can be taken over and run as-is. Typically, upon paying all the costs of ownership, it requires minimal additional capital influx or overheads related to process optimization and business efficiency. No wonder, then, it is so appealing to buyers and investors alike, as there is much less risk involved as compared to taking over a startup in its nascent phase.
If you are a business owner and looking to put your turnkey business for sale, then be prepared for the roller-coaster ride ahead. It will have all the thrills and chills of a pot-boiler movie and may test your patience at several stages. However, to attain the pot of gold at the end of the rainbow, efforts need to be made. It will bode well for you if you clearly understand and establish your reasons to proceed with the sale. This clarity is paramount when shortlisting buyers and negotiating with them to establish the price for your turnkey business for sale. Psychologically, and otherwise, too, business decision-making is at its optimum when considered from the other’s point of view. So, let us take a few steps in the shoes of a potential buyer to understand what attracts them to buy a turnkey business.
Tested And Proven Business Model
Entrepreneurs would agree, that the toil and anxiety that goes into building a startup can make you age 10 times faster. The amount of research to identify the target audience, efforts to set up an online store, testing, debugging, compliance management, and other activities can be quite taxing on the mind and pocket. On the other hand, a turnkey business has already gone through all those phases and has come up trumps. Having already tested the waters and withstood the seasonal storms, your turnkey business for sale is well-established and ready for use by the new owner.
** To further enhance this quotient, invest in creating standard operating procedures (SOPs) and process manuals for every aspect of your operations. This will make replicating the performance easier and increase your business valuation for the sale.
Already Established Customer Base
A great deal of money is spent in customer acquisition. However, in the case of turnkey businesses, the customer base is already there. The change in ownership is unlikely to sway existing customers to competitors.
** Investing in customer loyalty programs and enhancing brand recognition are 2 ways of ensuring high continuity of your turnkey business for sale and increasing its market value.
It is difficult to predict a startup’s growth trajectory. Some soar par the competition and some may take years to get established. Moreover, there is the need for regular funding to keep them afloat. Your turnkey business appeals to buyers since it is a platform that is already fully functional. There is already a core team in place, including suppliers. Buyers can choose to run the business as-is or expand over the underlying platform, depending on their investment appetite and ambitions.
** Invest in scalable technology that can accommodate growth and expansion with minimum additional capital. The cost of infrastructure is a tangible component while growth opportunity an intangible one while negotiating the price of your business.
Immediate ROI and Cost Savings
One of the most attractive features of your turnkey business for sale is the fact that it will generate revenue right from the get-go. Having completed the sales process, the new buyer can start getting returns on their investment without having to do much, at all. Furthermore, they save a lot of money that would have, otherwise, been spent on marketing, advertising, customer acquisition, technical development, supplier and delivery logistics, etc.
Personal Reasons To Sell
Apart from the aforementioned reasons, in which we were considering the buyer’s perspective, there can be several unique reasons of your own to consider putting your turnkey business for sale. These can range from a loss of interest in running the business, exhaustion and burnout, or a change in personal circumstances and priorities in life. Other compelling reasons could be an aspiration towards a new venture or perhaps, it was always your end goal to cash in on your success and move on. Some people choose to put their turnkey business for sale due to poor performance. While it could be tempting to cut your losses and free yourself from the ongoing anxiety, experts recommend against it. Remember the adage, ‘the best time to sell a business is when it is doing well.’ If you sell on a dip, you are likely to be undervalued and make losses on the sale.
We have shown both sides of the coin here. Wearing the buyer’s hat to understand the reasons for selling is an important exercise that can also help you find innovative ways to bring in more efficiencies or improvements in your current operations, thereby leading to a better eventual valuation of your business. Furthermore, there are personal reasons, too, that need to be considered to ensure you are in command of the process and get the best returns for your turnkey business for sale.