Statistics show that among all small businesses, only a third of them make it through the second generation and among those that make it, only a third makes it through the third generation. Given this, most business owners consider selling their businesses rather than passing it to their children who may be interested in doing something else with their lives. Apart from allowing business owners to award their children with the freedom to pick their own careers, selling their business also allows them to maximize the value that they can get for the business. This is mainly because they are selling their business while it is still performing very well.

However, given that selling a business can be a complex process, business owners need to take some steps that allow them to get the best deal for their business. One of these includes understanding how a buyer's mind works so that they can make their business more attractive to buyers.

In dealing with potential buyers, business owners need to understand that buyers are basically making an investment, which means that they need to be able to satisfy a buyer's investment and operational needs. This is because doing so can help a business owner make headway in facilitating the sale and in gaining a stronger negotiating position. One way of doing so involves taking the necessary steps that can help business owners accurately determine the value of their business. This would involve looking at the two ways the value of a business can be determined, which include assessing the value of the assets of the business and valuing the Free Cash Flow or FCF of the business. This can be helpful because the value of the company's assets represents the floor value or price of the company while the FCF reflects the value of the business as an operating company or its income generation potential. Between the two, the FCF plays a bigger role in determining the price of a business because usually an offer made by a buyer largely depends on the income potential of the business.

When business owners decide to sell their small business, one of the best ways to make their businesses more attractive to buyers is for them to put into the buyer's shoes. This can be helpful because by understanding what a buyer is looking for and on what a buyer bases his decisions on; business owners would then be able to take the necessary steps to make their business more attractive to potential buyers.