Raising Prices Prior to Listing the Business for Sale Increases the Sale Price

By Hoke - Last updated: Wednesday, January 29, 2014 - Save & Share - Leave a Comment









[box] If you can, raising your product prices before the sale is a great way to increase the discretionary income and therefore the sales value of the business. The prices should be raised with enough time (2-3 months) that any customer reaction because of the price changes would have occurred.

A competent business broker will factor the additional profit into the full year Adjusted Income Statement even if the price increase was relatively recent. Be sure to keep track of the price increase percents and let your business broker know. You may need to provide detail of the price increases during Due Diligence.

Simply disclosing an opportunity to increase the price will have far less meaning than an actual completed price increase because the new buyer doesn’t have the feel for the possible customer reaction a seller has.[/box]

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Posted in Business Valuation, Improving Business Desirablilty, Preparing the Business for Sale, Pricing the Business • • Top Of Page

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