The story of your small business started one late night when a few doodles on a cocktail napkin evolved into a passionately documented idea that would change your life. Over time, its inspiration led you to strike out on your own.

You gave your brainchild a strong name, possibly even your own, ensuring she’d develop a powerful stand-alone identity over time. Before your eyes, she grew legs and began to walk and, soon after, run.

By now, your baby has transformed into a real, tangible, thriving enterprise. Your one-time vision has metamorphosed into a booming enterprise with millions in revenue and dozens of employees. So what now? Should you sit back and enjoy the view from the top, or is it time to sell? How do you know? It may be time to explore selling your company in the following situations:

Market conditions // Your company benefits from the stars being in perfect alignment, enabling you to generate higher-than-normal profits. You know the market can’t persist over the long term and are unsure how long you can rely on the windfall. Research and engage a reputable business broker or a credible mergers and acquisitions firm to attract offers. More suitors provide leverage.

An unexpected offer // You didn’t even know your enterprise would attract big-time suitors or that their interest level would be expressed with that many zeros. You’re more interested than you would’ve expected. If you entertain an offer, don’t tell your employees. Remember, only one in four letters of intent ultimately result in a deal. Instead, consult your legal, banking and accounting advisers.

Time for change // You’re ready to enjoy the fruits of your labors. You’re itching to pursue a new adventure or start another business. Or perhaps health, financial or personal issues have had an impact on your interests. Whatever the reason, the time is now. Just be aware that if a buyer catches wind of these motivations to sell, it will likely work against your selling price.

While you’re preparing your company for sale, you’ll likely encounter items that you wish had been top of mind long ago. For those still building a business, longing for the day of cashing in long hours for a sailboat, it’s always a good idea to build your business with the end in mind. Regardless of your horizon, be it years or only months, three essential tips on selling your company will help you maximize the return on what likely is the largest investment of your life.

1. Make a quality first impression // Be organized. Would you want to buy your company based on the first impression it gives?

• Help the buyer to understand why you are selling the company. If the company is so great, why are you walking away?
• Have your incorporation papers, licensing agreements and permits, any leases, crucial contracts, etc., readily available and in order for a buyer to thoroughly review.
• Confidently articulate your succession plan, and identify your key personnel whom the new owner can rely on moving forward. Include those who manage key client and vendor relationships and those who are vital to the company’s operations.

2. Know your business // Understand your financials—and make sure they’re in order and easy for a buyer to understand.

• Have a reputable and experienced third party value your company. Getting this done early in the process will allow you to not only weigh it against offers, but the report also will provide you with your company’s strengths to leverage and the weaknesses to correct before trying to attract suitors.
• Formal financial statements prepared by a third party will give a buyer greater confidence and can minimize time spent in the due diligence process. Time is money. If you’re unable to budget this, tax returns can suffice on occasion.
• How profitable is your business, really? Are you claiming nonoperational expenses in your company? Items like your country club membership, auto lease or higher-than-normal travel and entertainment expenses can often cause a business to seem less profitable. Are there any large, one-time expenses that need to be backed out?

3. Stay focused // Keep your eye on the prize.

• Ensure your business continues to operate like a well-oiled machine. You need your company’s performance to remain optimal, especially while you’re under a buyer’s microscope. Failure to do so will, of course, be detrimental.
• Your attorney, banker and accountant can be tremendous resources when it comes to mergers and acquisitions. Rely on their guidance and understand your deal-structuring options to minimize tax implications.
• Remember your motivation for selling your company. Why did you begin pursuing this endeavor in the first place? If you’re not accomplishing your goal, don’t be afraid to walk away.