What is your store worth?
In the past, we have discussed items that sellers need to address when preparing to sell their stores. Many sellers spend the majority of their time preparing their financial information. This is important and it should be presented in a concise format that a buyer can easily understand.
However, updating the physical condition of the property is also extremely important. A buyer’s first impression of your store will be its condition and appearance from the street. So fix those projects that you have been putting off. Empty the waste baskets, clean the windows, remove clutter, replace the worn-out light bulbs, these are all small items that will make your store more attractive to customers and buyers alike.
Upgrades will be dictated by your budget and the time required to complete projects. For example, if you were planning on painting the exterior of the building you should continue with the project. If the state is requiring tank top replacement or other significant upgrades and funds are available, you should also proceed. If the funds are not available, or you don’t want to take on the project, you need to be willing to accept a lower price when it comes time to sell.
During the due diligence process, buyers will discover the status of the petroleum equipment, IT equipment, building code violations, condition of the septic system, to name a few. . If significant upgrades are being required by various state agencies a buyer will discount their purchase price to make these improvements. These discounts may be much more than the actual cost you may incur. Selling a property that meets all state requirements makes the process smoother and typically yields a higher price.
Preparation and advanced planning are required to achieve the maximum price for your store. Presenting a solid financial picture of your operations is essential. Just as important is to have those deferred maintenance projects completed and the property to be in top condition. The goal of the seller is to make the due diligence process as smooth and trouble-free as possible. Buyers are looking for areas of deficiencies to reduce their purchase prices. Having resolved those potential issues before marketing your store will create a more desirable property that will yield its maximum price.
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