Two tough truths about selling your business

The unfortunate reality is that less than 35% of businesses sell when taken to market, and only 23% of business owners are happy with their company valuation.

For more than two thirds of business owners, selling your most valuable asset is a disappointing experience at best and an impossible pipe dream at worst.

Unless your business is a leader in your category, you're happy to sell it at a discount, or both - selling your business is likely to be a tough and unrewarding reality check. To give yourself the best opportunity for sale at a strong valuation, you have to do everything possible to present your business for sale in a manner that makes it stand out from the other businesses on the market.

In the same way it’s common practice to invest in the presentation of your home before selling to attract the maximum number of interested buyers and the maximum sale price, investing in the presentation of your business’ brand will positively impact market perceptions of value and attract more interested investors.

How does rebranding help with selling a business?

I've never invested in branding. Why should I do it now when I'm trying to sell?

For many businesses, branding has not been a priority through their lifespan. Owners and management have been able to sustain and grow their businesses with a focus on product, sales and relationships rather than investing time and energy in the unfamiliar area of branding. This often means that at the point of preparing a business for sale the brand is the single most detrimental part of the business.


It’s no coincidence that businesses who have failed to build a positive brand perception are over-represented in the 65% of businesses that are unable to sell.

With only a third of businesses achieving a sale at all, those with substandard branding are starting-off at a great disadvantage. Yet, rebranding is a relatively cost and time effective way to make a significant difference to market perceptions and your chance of a successful sale.

Is rebranding a selling strategy backed by research?

A recent study by the Lubin School of Business at Pace University in New York demonstrates the business case for rebranding.

The study found a direct correlation between positive brand perceptions and increased brand equity, which were found to be significantly associated with perceived price above and beyond book value and earnings information.

‘Evidence of this value is supplied by recent examples of the substantive sale price of a brand even after bankruptcy and liquidation of a firm’s remaining assets, writes Amy Zipkin, a source quoted in the study.

The sale price of a business reflects investor perceptions of the current and future earnings potential of all its assets, both tangible and intangible ( Simon and Sullivan, 1993 ). Investors view brand equity as  ‘the capitalized value of the profits that result from associating that brand with particular products or services.’ Thus, anything that might positively change investor perceptions of brand equity will affect the businesses value due to positive perceptions of impact on future earnings.

Investors recognize the role that brand plays in a business’ ability to attract and retain customers. As investors’ perceptions of a business’ brand strength increase, the market reacts accordingly, adjusting perceptions of the financial valuation of the business.

How much will rebranding cost?

As with any business investment, there should be a business case for the amount you spend. Whilst you can’t buy a Rolex for $100, not everyone needs a $20,000 watch either.

We have three packages that provide a starting point depending on the size of the business and the sale price you are looking to achieve. Our extensive experience branding businesses large and small over the last 25 years positions us as experts to return the greatest value possible – a successful business sale at a strong valuation.

You can review a breakdown of our Rebranding for Business Sale packages here.

 

What's the return going to be on an investment in rebranding?

The greatest possible return is the successful sale of your business. You’ve spent years (often decades) building a business with your blood, sweat and tears and it’s finally time to sell and collect the reward for all your hard work, ingenuity and perseverance. But all that effort and sacrifice is for nothing if you can’t find a buyer.

We recently we worked with a Health Services business to rebrand them as part of their preparation for sale. The process was a success with the business attracting interest from multiple parties and the sale price exceeding initial expectations. Our client, Damien; the company founder and owner explains the value of rebranding from his perspective below.

You can read a case study of this project here.

Is Truly Deeply experienced in my category?

With more than 25 years of branding experience, Truly Deeply is one of the most capable and qualified, specialist branding agencies in this part of the world. Over this time we have branded more than 1000 different businesses across almost every conceivable category. We bring such a depth of experience that if we haven’t worked in your specific niche, you can bet we’ve worked in an adjacent one that allows us to bring fresh insights.

Most importantly, we see the world and your business through the lens of the most important market; your prospective buyers. We understand what they are looking for and how they see your brand relative to your competitors. It is this insight and experience that arms us to rebrand you to maximise this change in value perception.

You can review many of our recent branding projects here.

Our rebrand delivered us 10 times the investment

Our rebranding was one of the very best investments of my life. Great brands attract attention. They cut through the crap. Business brokers love nothing more than introducing a great brand, it’s an easy sell, because great brands are rare. A great brand is like an A-Grade property. You know it when you see it, and so does everyone else. FOMO (fear of missing out) kicks in and creative tension is created… and suddenly your brand isn’t for sale, it’s for Auction. However, unlike A-Grade property, an A-grade brand doesn’t require millions to create… but it takes millions to buy. I’d comfortably say our rebrand delivered us 10 times the investment. I can’t think of a better commercial investment than an effective rebrand.

Damien James, Founder and CEO
Dimple Care

If you're planning to sell, give us a call today

If you’re considering selling your business, or have been trying without success, come and spend an hour with us to evaluate the potential for rebranding to positively impact your sale process.

Less than 35% of businesses sell when taken to market

Less than 25% of business owners are happy with their company valuation

Leverage rebranding to give you the greatest chance of a successful sale

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