Although I have been selling businesses in Colorado for over thirty years, and have seen many disruptions of the business cycle caused by events such as war, bubbles, and recessions of various magnitudes, the current economic environment has characteristics that are different than the others. Prior to the mandatory stay at home order from Colorado’s Governor Polis, the economy was operating at close to capacity and our firm had several transactions in process. It appears that most buyers, sellers, and lenders want to continue to work together to complete those transactions. As you would anticipate, we are involved with robust communications with our lenders, who are still interested in making acquisition loans. We also continue to receive new inquiries from serious buyers, although the “tire kickers” are less active, which is not necessarily bad from our standpoint.
If your business is currently on the market, or you plan to go to market in the near future, you can be proactive in making your business more marketable. Below are a few suggestions:
- Document the impact of the economy – either good or bad – on your business and create a plan for capitalizing upon either the current situation or the recovery.
- Although we hope that you do not have to eliminate any employees, if you do, this could be a good opportunity to improve your team.
- If you have some additional time, use it to catch up on deferred projects such as cleaning up the facility, updating procedure manuals, improved employee training or certifications, or reviewing your marketing programs.
The stock market is often a leading economic indicator of the overall economy. Similar to the investment sentiment being demonstrated on Wall Street, we are optimistic and anticipate that the those businesses that are appropriately positioned will be in high demand when the rest of America is able to go back to work. Please feel free to reach out to us on a confidential, no-obligation basis if you have questions or you believe that we can assist you.
My team and I are appreciative of the healthcare workers and first responders helping those in need and wish you and your family good health and a positive attitude.
(originally published in the April 2020 eNewsletter)