The time has come, for better or worse, to sell your business. Whether you’re retiring after a long and successful run, or closing up shop reluctantly, preparation is key to receiving a fair deal when the final papers are signed.
There are many factors to be considered when selling a business, and your decisions can make or break your profit from the transaction. Just as business owners develop a business strategy before launching, they need a sound plan prior to turning out the lights.
The blueprint begins with identifying potential issues on the horizon, or deciding on a retirement date months, or even years, ahead of time.
Then comes taking necessary and well-thought-out steps so that business owners can optimize the return on their investment.
Working with seasoned professionals such as a valuation company, accountant or broker, could be a great help in reaching your goals. These experts have critical, particular knowledge and experience. Valuation specialists like brokers bring a unique understanding of the market, helping to set a realistic selling point.
It is also vital for proprietors to have their financial house in order. Buyers will take an in-depth look of your finances. They may become disconcerted, or place lowball offers if your books appear confusing and unreliable when giving a true assessment of operational costs.
This is where an accountant could be of great assistance. They have the acumen to review tax returns, financial statements and other fiscal documents, and guide you on how to best approach tax implications.
You can also help yourself by compiling a thorough list of employee agreements, leases, pending litigation and other aspects of your business.
In addition, think seriously about taking on a lawyer. An attorney may pounce on shady language and fine print that would otherwise result in a lopsided agreement that leaves you holding the bag.
Remember that appearances count physically as well as on paper. If you own a store, it should appeal to a potential buyer’s eyes. Prospective buyers would not look kindly on shelves in disrepair, or floors and carpets that have noticeably lacked a good washing and vacuuming.
If possible, you might want to think about offering gratis training to help the new owner through the transition process. This is especially important if they are not experienced in your line of work. They would likely be grateful for your assistance and become an important member of your business network.
Just as buyers will analyze everything about your business, you also want to make sure to sell to someone who is experienced, shares your values and can maintain or improve upon what you’ve built.
Do your due diligence and research possible buyers so that you can avoid someone with an unscrupulous past. Selling a business the correct way takes a lot of hard work and can be extremely stressful and emotional. By preparing well in advance and implementing a solid strategy, business owners can reduce anxiety, stay on track and receive the deal that they deserve.
