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A previous post reminded you that in 2022-2023 those COVID-era “free money” programs are going to start demanding repayment. Should you pay the minimum necessary, or get it off your books? Many owners think that a healthy line of credit and a large business loan are indicators of a healthy business. Maybe so, when you decide to sell that business, that loan is going to detract seriously from the business value even though it won’t be the seller’s problem. Why is that? 

A previous post reminded you that in 2022-2023 those COVID-era “free money” programs are going to start demanding repayment. The business may be able to handle the ongoing payments, thanks to generous terms, but if you want to sell the business you’ll need to deal with this loan. There are several choices, and taking the wrong one can create far worse problems than how to pay off the loan. Here’s what those paths look like: 

Lucy, you’ve got some un-explaining to do. The government’s attempts to undo some of the damage to small businesses caused during pandemic of 2020-2021 may have created the impression that the Small Business Administration (SBA) is the big sugar-daddy that will make every owner’s problems go away. Those days are gone. Whether you’re planning to keep running your business or have thought about selling it, you need to know how to play the game the way it is now if you want to avoid penalizing yourself and your business … 

The internet is full of advice from professionals hoping to land a bigger client. Surely a small business like yours can’t run into any issues that someone hasn’t already explained on their website or on YouTube? Guess again. Let’s look at some examples from just the last month or so … 

Ah, the COVID days, when the government was falling all over itself to give you money to help you stay in business. So you took it. Now things are better and you want to sell. Not so fast. You may have a rude shock in store. If you do not manage it right, you may not be able to sell at all …​

Buyers value your business based on its performance to date and how it compares to other similar businesses. While that comparison includes a number of intangibles, such as location, lifestyle, and branding, those are just modifiers on a value based strictly on a reasonable multiple of the profitability. The better you can support your numbers, the closer to the top of the range you will get; if you can’t, you’ll see discounted offers far below that range. Here’s how to make your records work for you.