|
Top
10 Tips for Selling Your Business
Most
of us have experienced the highs and lows that come
with selling a home.
Conversely, most business sales are usually
once-in-a-lifetime events.
Typically, that means that many business
owners are unprepared for what is involved in the
sales process.
After
all, you do not just stick a For Sale sign on the
front lawn of your office building or plant. Selling
a business is a long and complex proceeding,
requiring many hours. There are many pitfalls - and
that's why there is a growing trend to using
business intermediaries to broker the deal.
Based
on our 30 years of experience in helping people sell
their businesses, here is a Top 10 list of tips to
help make the experience a positive and successful
one
1.
Be reasonable about the value of your business.
Inflated
expectations interfere with your business
intermediary's ability to negotiate the best value
for you.
2.
Carry on business as usual. Don't
become so obsessed with the transaction that you
ignore day-to-day demands. Your eventual buyer will
need to see a healthy business, not one suffering
from neglect.
3.
Keep the sale process strictly confidential.
A breach of confidentiality surrounding the sale of
a business can alter the transaction dramatically.
Any potential purchaser looking at a business for
prospective purchase must sign a confidentiality
document.
4.
Prepare for the sale well in advance.
Be sure your records are detailed and complete for
at least the past few years and do all pertinent
legal or accounting housecleaning as well as a
physical sprucing up of the facility.
5.
Anticipate information the buyer may request.
In order to obtain financing, the buyer will need
appraisals on all assets, plus information to
satisfy any environmental regulations that may
apply.
6.
Achieve the highest price through buyer competition.
Since this can be tricky, you're advised to let your
intermediary, as a third party, create a competitive
situation with buyers to position you for the best
transaction value.
7.
Be flexible.
Do not be the kind of seller who wants all cash at
the closing, or who will not accept any contingent
payments or an asset transaction.
8.
Negotiate, do not dominate.
You may be used to being your own boss, but the
buyer may be used to having his way too. With your
intermediary's help, decide in advance when to hold
and when to fold.
9.
Keep time from dragging down the deal.
To keep the momentum, work with your intermediary,
your accountant, your attorney and other experts who
may be required to be sure that potential buyers
stay on a time schedule and that offers move forward
in a timely fashion.
10.
Be willing to stay involved.
Even if the process has been exhausting, realize
that the buyer may want you to stay within arm's
reach for a while. Consult with your intermediary to
determine how you can best achieve a smooth
transition from owner to past owner.
Above
all, remember that planning ahead is key. Too many
business owners fail to plan for the day when they
will want to sell. Then something happens - most
often a health problem - and they are forced to sell
quickly. Rushing to sell can result in a failure to
capture the true value of the business. The best
time to sell is when you don't have to!
Forward
to a Friend
|
