The oldest of the baby boomers—born between 1946 and 1964—currently are winding down their careers, including thousands of business owners.

Unlike previous generations, however, baby boom entrepreneurs are expected to face fierce competition when courting potential buyers. With approximately 25% of the total US population made up by baby boomers (as of 2011), many as 3.8 million baby boomer–owned companies will go up for sale in the next two decades, according to a 2012 report .

If you’re considering selling your company, do you know how to position it for a successful sale amid the buyers’ market of the coming decades?

Plan In Advance for Your Exit Strategy

Exit planning is the process of creating a transition plan for your company in the event of a sale, transfer to a family member, or your death or disability. The process ideally starts your first day in business and evolves as your company grows. After you’ve decided on an exit strategy, it’s important to assess your business’s growth, assets and human resources continually. Then refine your approach if necessary.

For example, let’s say your 10-employee company currently generates $5 million per year. To successfully sell it in 2025, you estimate that the business will need to generate $12 million per year with 17 employees. By checking your progress quarterly, rather than annually, tweaking your plan will be an easier process.

The specifics of your exit plan may also have considerable tax implications, so it’s important to consult with your personal and business-related financial advisors throughout the process. For instance, financing the sale yourself or structuring an incremental performance-based sale may lower your tax bill. By not receiving a lump-sum payment, you may cause your annual personal income to be lower. Even more, by not requiring a large upfront payment, you may attract a larger pool of potential buyers who may bid up the price.

Another important aspect of preparing for your departure involves identifying and assigning successors for yourself and other senior managers. Potential buyers typically want to see that a succession plan is in place, so that key day-to-day functions and responsibilities will be executed seamlessly in your absence.

Assess Regularly to Obtain Optimal Value

With multitudes of boomer–owned companies hitting the market in the next 15 to 20 years, potential buyers will take a hard look at our operations ahead of any sale. But by starting the assessment process early, you can ensure time will be on your side.

After finalizing your exit plan, determine the fair market value of your business. This will give you a complete picture of where your business stands and allow you to identify any potential weaknesses that could hinder a sale down the road or lower your plant’s price tag. Generally, your company’s appraised value comprises future earning potential and any assets, including real estate, inventory, patents, machinery, vehicles, tools and other equipment. Read our latest article on valuation here.

But the devil is often in the details. So to obtain a complete financial snapshot, it’s important to supply the appraiser with as many financial records as possible. Provide five years’ worth of balance sheets, profit and loss statements, tax returns, leases, contracts, property assessments, payroll and personnel records, and equipment maintenance and sales records.

Keep a Clean House

Obtaining the best price for your business means accentuating its attributes and minimizing — or eliminating — any shortcomings. Do so by meticulously organizing all of your financial records, analyzing relationships with vendors and customers, and working with your financial advisor to anticipate any financial questions a potential buyer might have about the inner workings of your business.  Well prepared financial statements are an important part of the plan and can translate into selling your company for more than you originally thought it would sell for.

Just before the sale, it’s important to make sure your equipment maintenance, noncompete agreements, leases, and other key legal and tax records are up to date. Your financial advisor can help you plan so that you’re maximizing profits and limiting your tax exposure every step of the way.

Other related articles: Business Succession Planning at Year End, The Role of ESOPs in Retirement Planning