Mark Osborne explains how company sale prices are driven by earnings multiples. Improving margins by even 1-2% multiplies your exit value significantly, making small profit gains worth far more when you sell.
And you have to keep in mind when you sell a business, it's the way that you get to the price is it's multiples of your earnings, right? Wow. And so every dollar that you make more in your business, that you're more profitable, that pays off like 3, 4 times when you sell it. So it really, really pays off when you start looking at your margins, like how can I improve my gross margin just by 1%, 2%? It has a big impact on the bottom line and that's the kind of mindset that you need to have if you want to grow your business successfully.
How Can You Maximize Your Business Value Before Selling? with Randy Katz Video
