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Saleability Score
Step
1
of
5
- Market factors
20%
Rank your business (with 5 being good and 1 being poor) against the following criteria to calculate the saleability score.
Your score for each section calculates at the base of each page and displays a total at the end. You can opt in to receive a report of your saleability score and a free pre-sale action plan.
Market growth & potential
*
Business growth is a significant consideration for purchasers and investors. A business with a good track record of growth and potential for future growth will typically achieve a higher valuation.
1
2
3
4
5
Industry barriers to entry
*
The higher the barriers to enter your market and compete with your business, the more secure the business is and the more attractive it will be.
1
2
3
4
5
Competitive activity/advantage
*
Are you in front of the pack? Do you have a process for staying in front of the pack, a sustainable competitive advantage?
1
2
3
4
5
Dominant market position
*
Having a large percentage of your target market enables you to exert influence over your position competitively. A large percentage of your target market often means you have more profit to reinvest to drive the business forward.
1
2
3
4
5
Economic prosperity
*
A growing market of prosperous customers will add to the value of the business to potential purchasers.
1
2
3
4
5
Total score
Total score % (convert score to a percentage)
Output
Your business scored less than 50% on market factors. This is a difficult factor to influence. Look at adjacent markets and ways to improve your competitive advantage.
Your business scored above 50% on market factors. You are in a solid market, but look for ways to improve your market position.
Years of business operation
*
If your business has been operating longer than 5 years, rate it at 3; 10 years = 4; more than 10 = 5. Longevity can be a good indicator of positive factors in a business.
1
2
3
4
5
Management strength
*
A deep pool of management experience in the team is a good indicator of the ability to adapt to the dynamic environment of the modern business world.
1
2
3
4
5
Customer loyalty
*
Loyal customers are a good indicator of strong business processes and systems and a quality product delivering for a purchaser.
1
2
3
4
5
Brand awareness
*
A well-know brand assists with the business's stability and offers growth potential.
1
2
3
4
5
Customer base
*
A diverse customer base with no customer accounting for more than 10% of revenue is desirable.
1
2
3
4
5
Packages - IP & technology
*
Trademarks and patents registered with IP Australia are a positive for a purchaser.
1
2
3
4
5
Key staff longevity
*
Staff longevity is a strong indicator of a positive culture in the organisation.
1
2
3
4
5
Location
*
A central location ensures access to suppliers, skilled staff and customers.
1
2
3
4
5
Non-reliance on key manager(s)
*
Key person risk is an area that will be closely examined in due diligence.
1
2
3
4
5
Ability of business model replication
*
Ability to scale or grow a business is a positive. The ability to open in multiple new locations is a positive.
1
2
3
4
5
Business systems and processes
*
Solid systems and processes help reduce risk and increase the ability to grow the business.
1
2
3
4
5
Total score
Total score % (convert score to a percentage)
Output
Your business scored less than 50% on business factors. Develop a strategic plan to change areas where the business is currently weak.
Your business scored more than 50% on this metric; keep working on your key success areas.
Profitability past/present
*
Solid financial performance over at least 3 years is a good indicator of a solid business.
1
2
3
4
5
Profitability growth forecast
*
Growth at a net profit level is key for a business purchaser.
1
2
3
4
5
Revenue growth
*
Growth at the sales level is a good indicator of a business with positive prospects.
1
2
3
4
5
High certainty in budget
*
The ability to forecast reliably enables a purchaser to be more comfortable with the business and the level of debt it can support.
1
2
3
4
5
Recurring revenue model
*
More than 50% revenue is desirable and long-term contracts are another positive.
1
2
3
4
5
Total score
Total score % (convert score to a percentage)
Output
Your business scored less than 50% on financial factors; consider engaging a virtual CFO to support you to improve the business's financial performance.
Your business scored more than 50% on this metric; keep working on the business's financial strengths.
Reason for selling
*
Retirement or health-related reasons will be considered normal.
1
2
3
4
5
Synergy and value add of buyer
*
The ideal buyer, who is likely to pay the most, will be the one who can extract revenue growth from the client base. Cost saving is also attractive, although harder to realise in practice.
1
2
3
4
5
Degree of risk
*
Often risk is assessed in due diligence, which will consider key person risk, key customer risk and other risk factors in the business.
1
2
3
4
5
Market for business sale
*
A competitive process for the sale of a business, with multiple interested parties, is likely to inprove the price and the timeliness of the sale.
1
2
3
4
5
Total score
Total score % (convert score to a percentage)
Output
Your business scored less than 50% on buyers' considerations; implement a plan to improve areas of weakness.
Your business scored more than 50% on this metric; continue to seek areas of improvement.
YOUR SALEABILITY SCORE IS
If you would like to receive a report of your business's saleability score and a pre-sale action plan, please fill in your details. All submissions received are strictly confidential.
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Email address
*
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