Tips For Business Sellers
Archer Business:
1. Engage An Expert Business Broker. A breach of confidentiality surrounding the sale of a business can change the course of the transaction and damage a biz in the future.
2. Prepare For The Sale Well In Advance. A good business broker will prepare an confidential memorandum for the business to have ready when potential buyers are qualified. The business owners can help in the process by “housecleaning” – as well as a literal sprucing up of the facilities.
3. Place A Reasonable Price On Your Business. An inflated figure either turns off or slows down potential buyers. Rely on your business intermediary to arrive at the best “win-win” price. An “unrealistic price” discourages many buyers from even looking at a business.
4. Carry On ‘Business As Usual’. Don’t become so obsessed with the transaction that your attention wonders from day-to-day demands, affecting sales, costs, and profits.
5. Anticipate Information The Buyers And Their Financing Sources May Require. In order to obtain financing, the buyer will need appraisals on assets. Lenders will require at least three years of tax returns and the most recent financial statement.
6. Achieve Leverage Through Buyer Competition. A good business priced properly will many times create interest from several buyers and create a competitive situation.
7. Be Flexible. Don’t be the kind of seller who wants all-cash at the closing, or who won’t accept any contingent payments or an asset based transaction. Depend on the advice of your business broker – their knowledge of financing and tax implications.
8. Negotiate; Don’t Dominate. You are used to being your own boss, but be prepared to learn that the buyer may be used to having his way, too. With your business broker’s help, decide ahead of time ‘when to hold and when to fold.’
9. Keep Time From Dragging Down The Deal. To keep the momentum up, work with your business broker to be sure that potential buyers stay on a time schedule and that offers and counter-offers move in a timely fashion.
10. Be Willing To Stay Involved. Even if you are feeling burned-out, realize that the buyer may want you to stay within arm’s reach for a while. Consult with business brokers to determine how you can best effect a smooth transition.
Also read: Want To Sell A Business? You May Not Be Ready
Entrepreneurs Rarely Realize How Hard It Is To Sell Their Business.
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