Revenue is up, profits are holding, and I’m riding high like a king. Is this a good time to sell my label business?

Rock, We’re looking at our end-of-year numbers, and – lo and behold – it looks like we made pretty good money this year. Revenue was up, net profits are holding at over 15 percent, and everything in the label converting world seems to be working in our favor.

A little back story…last year we changed things up significantly on the production side. These improvements are separate from the types of things we’ve done in response to COVID. These are things we’ve been talking about doing for years. It feels great that our employees are happy with the changes, and the new workflow has improved our efficiency.

Equipment-wise, our machines are new-ish, less than 5 years old. Our plant is clean and well maintained. I don’t expect we’ll be making any capital expenditures in the coming year. A buyer of the business would like what they see, I think.

I feel like this is as good as it’s ever been, and I’d like to ride high, like a king.

But it crosses my mind over and over that this could be the best time ever to sell the company. Things may never look this good again. So…should I sell? Keep? Enjoy the fruits of our success? I await your reply.

It’s a wild time to own a business, but it sounds like you are making strong, strategic decisions. Kudos for taking care of your people.

I encourage you to download our free guide, Code Red: 12 Seller Mistakes, for owners who are asking themselves if this is the right time to sell. Find out what you might be overlooking as you assess your business – and yourself – for readiness.

Whether you sell or hold, you’ll want to analyze the entirety of your business – not just the revenue and net profit. We can help you with that analysis.

Do you think you can hang in there with this new high – or even more growth – for another 2 to 3 years? Not many owners would say yes in this environment.

If you thought you could, three full years as a profitable label converting operation – with the upward trend you’re experiencing – could put you in the catbird seat as a seller.

On the flip side, we never know how long a label printing and converting company – or manufacturer in general – will be in favor. We can’t predict whether industry multiples will go up or down. While we’re not seeing any close-in indicators of multiples dropping (especially for well-run businesses), there’s always a risk to hold versus selling in a hot market. Finally, we don’t know if there will be new threats to the economy that would affect the buy-sell market as a whole (not just in our sector) and the availability of cash and credit. Trying to time a sale is always a risk. In short, the future is a gamble.

Whether you intend to sell or hold, it’s smart to get a valuation as a reference point. We can do that internally or order one for you. We research many factors when we evaluate a business, including company leadership, your market position, your competitors, your location, and the synergy of buyers who are aggressively seeking businesses like yours.

This is part of our proprietary Road Map Assessment (RMA)*. The findings in the RMA help owners answer that very important question: “Is now a good time to sell my business?”

You’ll be able to see if selling the business will get you where you need to be with your wealth goals, especially if you are headed into retirement.

On the other hand, if the dollars don’t add up, we can look at developing a growth plan that matches your timeline.

We can also discuss how to begin replacing yourself and shifting your critical roles within the operation to make the transition to the new owner smooth and successful. Much of this depends on the type of buyer you’d like to attract and the timeline you need or desire. Some buyers have someone capable and ready to slide into the leadership position. Other buyers would need internal people in your organization to be able to step up and handle some of the executive duties.

We can also discuss other forms of transition in addition to a straightforward sale – such as a staged ESOP (Employee Stock Ownership Plan) – which could give you more flexibility in your exit timeline.

Here’s another thought: what if you sold your business and reinvested the proceeds into starting or buying another business? Or, you could sell your current business and then run a different business for a group of investors. There are so many possibilities for talented entrepreneurs who are comfortable with leading in times of uncertainty. It’s a real skill and in high demand.

I’d love to hear more about your success, your timeline, and what your ideal future looks like. Give me a call – no obligation – and let’s take a closer look.

*LaManna Consulting Group’s proprietary RMA – Road Map Assessment – is an in-depth report that analyzes your business in detail and provides top recommendations for your unique situation. Please note that our team can conduct the RMA discreetly, so your employees don’t have to know you are looking at options. Contact Rock LaManna for a confidential discussion of your specific situation and the options for working with the expert team at LaManna Consulting Group.