In over two decades of working with business owners, one of the most common questions we hear is, “When is the right time to sell my business?” The short answer is: when your business is doing well. The long answer is a bit more nuanced. Drawing from our years of experience, here are two important factors to help determine when to sell an HVAC business.
What do the financials say?
Hands down, the most important factor in selling your business (and thus, identifying when to sell your business) is its current financial state. You want to sell your HVAC business when it is doing well. We realize this feels counter-intuitive. If your HVAC business is thriving or trending up, it’s natural to think that if you wait a little while, you can get even more for your business. Unfortunately, that line of thinking has led to a load of regret for many sellers we know.
There have been countless times that we’ve valued an HVAC business at a desirable price, but due to a subsequent influx in business, the owner decided to hold off on selling. A year or two later, the business owner feels ready to sell… only to find out their business is worth less than it was before. What happened? Often, these owners encountered an unforeseen circumstance like a change in their health, the loss of a key client, or an unexpected downturn in the economy (we’re looking at you, COVID).
We understand the heartache and frustration that comes with this type of situation, especially after so many years of hard work. Getting a professional business valuation will provide essential information so that you can make the right decision at the best time for you and your business. The way we value a business helps indicate the best time to sell a company. We look at financial trends over time, which not only helps determine a sales price, but also assures a potential buyer that your business is stable and will likely continue trending upward.
Since we don’t know what the future holds, we must focus on what we do know. Financials are the best evidence of where your business is going.
What do your priorities say?
So, your financials are in order. On paper, it’s the right time to sell your HVAC business. But what if you’re not ready to retire? Good news: nearing retirement age is near the bottom of the list for determining when to sell a business. There are other priorities that can inform your decision. Maybe life has thrown you a curveball and you need an immediate influx of cash. Maybe you have another investment opportunity you want to take advantage of. Maybe a strategic buyer has shown interest in your company. Any of these scenarios indicate it may be time to sell your business.
We know you’re committed to the growth and success of your HVAC business. We also understand that as the business owner, securing your personal financial stability and growth is completely tied to the business. That’s a heavy and demanding load, especially in today’s economic climate. Consider this: Viking can help you secure your future with an upfront liquidity event, long term income and benefits with growth opportunities. We have been retained by an HVAC industry buyer who has proven operational processes to continue the growth of your company while securing your future, providing a secure platform for expansion while ensuring your financial security.
Timing is key when it comes to selling a business. Do not be caught wishing you had acted sooner. Make a confidential inquiry today, and find out if it may be the right time to sell your HVAC business.