As an owner of a bed and breakfast, you have spent many hours investing in your property and working tirelessly to increase its market value and appeal.
By taking the time and effort to build a thriving B&B, you have significantly increased the likelihood of turning a substantial profit when you decide you’re ready to sell.
It’s important to keep in mind, however, that selling a B&B property is quite a bit different from selling a regular home. The target buyer for your establishment needs to be someone who possesses the following qualities:
- Interested in moving to your B&B’s location
- Motivated to own a business in the guest house industry
- Equipped with the necessary capital to invest in a business
Even though you are selling a niche property, with patience, careful planning, and the assistance of qualified professionals, you have the potential of generating a very favourable return on your investment.
Preparing your B&B for exit
First and foremost, to the best of your ability, be patient and don’t rush into selling. Do your research, and make sure the market shows that it’s a good time to sell.
Once you’ve decided the timing is right, here are some steps to take to prepare your business for a smooth and successful sale:
- Compile financial records: Potential buyers will want to study your financials, so be ready to provide clean records of your taxes, finances, utilities, and applicable receipts.
- Consult a property inspector: Enlist the help of a professional to thoroughly evaluate everything on your property—from the roof and foundation to electrical systems and staircases.
By ensuring your B&B is up to code and in good condition, you will be able to better defend your asking price, and you will be providing peace of mind for you and your potential buyers.
- Conduct renovations and repairs: You only have one chance to make a good impression. Look at your establishment from a buyer’s perspective. Take the time now to make repairs, update decor, and enhance your property’s appearance.
- Take advantage of the season to improve “curb appeal”: If it’s springtime, spruce up your outdoor spaces with additional flowers and landscaping. If it’s the holiday season, decorate accordingly and focus on adding to your property’s overall charm.
- Offer a fully furnished sale: If possible, consider including furniture in the sale of your B&B. Potential buyers will appreciate the added incentive of acquiring a business that is ready to begin operations from the moment of purchase.
- Continue to improve and build your business: Evaluate your business and make any necessary changes now to ensure that it is performing well. Prospective buyers will want to see a successful business with regular reservations and high online reviews.
- Determine an accurate and fair price: There are numerous factors to consider when establishing your sales price, so it is highly recommended that you bring in a professional agent and a valuer to advise you on the correct price for your property.
- Enlist the help of a broker: Successfully marketing your business for sale will be essential, so consider working with a reputable business broker to guarantee that your property receives the most attention from potential buyers.
Top off your successful exit with thorough due diligence
I can’t reiterate enough how important due diligence is when it comes to buying or selling a business. Your B&B is no different. You’ve worked hard to build a successful business, and you deserve to walk away with a rewarding profit.
Here are a few things to cover:
- Determine what else to include in the sale: In addition to any furniture you decide to offer as part of the sale, consider also including additional items such as linens, kitchen supplies, and other equipment.
Adding these extra “perks” in the sale can significantly help increase the overall value of your property.
- Hire experts: An appraiser will help you calculate an appropriate selling price. A realtor will help you prepare your property for sale and pre-qualify potential buyers. A tax professional can compile your records and prepare all necessary documentation.
- Ensure compliance with all legal requirements: Guarantee that your zoning, permits, licences, and codes are all up to date, and be prepared to present applicable documentation.
Selling your B&B can be a stressful time. Although you’re excited to embark on a new adventure, you must also continue to run your business and patiently wait for the right buyer to come along.
However, we can help alleviate some of the pressure! Visit here and let us assist you toward a speedy and successful exit. And, if you're ready for the next challenge, take a look at other opportunities available.
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