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Adam Ray 12/13/19 Adam Ray 12/13/19

5 Best Practices For Preparing Your Business For Sale

Are you ready to put your business up for sale? Here are some best practices we recommend you use to properly prepare your business for the sale.

Business for sale

When you have a business for sale, you need to be certain that you are leaving no stone unturned when it comes to the details.

In addition to figuring out exactly why you want to sell, you'll need to cover your legal bases and come up with a strategy that works. This will help you fetch the biggest price, while also getting help with negotiating the deal.

Follow these tips so you can prepare your business for sale.

1. Get a Thorough and Up to Date Valuation

For starters, you'll need to get a proper business valuation. During a valuation, professionals that understand the market will take an objective look at your company to see how much it is worth.

They will look into all matters of the business, including your cash flow, debt, future growth potential, and other variables.

When your business has been valued, you will know what kind of sell price the market dictates and how much you can stand to earn. Having this report will also give you leverage and clarity when you're speaking to buyers.

Start to put together documentation for your business well in advance so that you can show clean, accurate records of your revenue, budgets, and other important matters.

2. Understand Completely Why You Want to Sell

Aside from financial implications, you need to know exactly why you intend to sell the business.

For some, it may simply be time for retirement, and selling the company can give you plenty of liquidity. You may also be at a point where cutting your losses and selling a majority of your company in an acquisition might make good sense.

Your reason for selling will help you choose which strategy can work best for you.

3. Carefully Vet Your Prospective Buyers

In addition to the sales price, you need to know who you're selling the company to.

Work with a business broker so that you can research every buyer's background. Finding a broker is crucial because studies show that only 20 to 30 percent of companies ever even find a buyer.

When you are seeking a buyer, move as carefully as possible so that your company lands in good hands, and at a good price.

4. Have a Plan in Place For the Transition

You need to have a solid exit strategy in place so that you can comfortably transition ownership and management.

When you have a plan, you're better able to choose a successor and make sure the company is in good hands once the sale goes through. It will protect the brand moving forward, and any future equity you might retain in the company.

5. Get Some Marketing Help

Your first two priorities should be to get legal help to know exactly where you stand and making a point to stay silent on it until the time is right for you to share terms with the public.

Once you are ready to announce to the public, make sure that you have a marketing team in place to help you communicate your message.

Follow the Right Tips When You Have a Business For Sale

When you have a business for sale, these are the tips that you need to keep in mind. It will help you get the best deal while protecting your interests.

Get in touch to set up a free consultation for our business sale and acquisition advice.

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Adam Ray 12/3/19 Adam Ray 12/3/19

Best Practices for Getting Your Business Ready for Sale

There are many reasons why people sell businesses, from cutting your losses to cashing out and growing your wealth. Whatever your reason is, you'll need to understand the art and science of getting your business ready for sale.

Use this guide to help you in getting your business ready for sale.

Having an up-to-date valuation for your business is essential if you're planning to make a sale.

Getting your business ready for sale requires a diligent, scientific approach.

Learning how to sell a business includes making sure you're handling everything on the legal front while also maximizing your profits in the sale.

Not sure you're quite ready? No problem! Keep reading for seven tips that will have you feeling like a pro in no time.

1. Get a Professional Valuation For Your Business

Having an up-to-date valuation for your business is essential if you're planning to make a sale.

During a business valuation, a credible third party will break down everything from your marketplace value, cash flow potential, and how much you can expect to make in a sale, to an in-depth look into your strengths and weaknesses.

Accountants or investment bankers will make your valuation as accurate as possible.

2. Shore Up Any Red Flags and Make Improvements

The last thing you'd want is to give a prospective buyer any reason to balk at buying your business. Be sure that you audit your business for any red flags before moving forward with the sale.

This means getting rid of any liens or tax issues, and ensuring that ownership is crystal clear. Settle any outstanding balances and legal issues so that they don't bleed into the sale.

3. Be Clear on Your Intentions For Selling and What You Hope to Gain

Everyone has different reasons for selling their business. Never move forward with the process unless you're clear on your intentions and goals.

For instance, you might sell the business to retire, dissolve the business during a dispute, or get an influx of cash flow. When you know your goals on the front end, you'll be able to get the results you're looking for.

4. Analyze and Clean Up Your Books

Without question, your books need to be in order if you're going to sell your business.

If you don't have clear financial records, no credible buyer will take the chance of purchasing your company. You'll need to have up-to-date books from the past three years, in addition to tax records.

Piece together your reports and have copies available to buyers.

5. Put Together a Financial and Legal Team to Facilitate the Sale

In order to get the best from your business sale, you'll need the backing of financial and legal professionals every step of the way.

Make sure that they specialize in mergers and acquisitions, and that you use M&A analytics tools for due diligence. In the meantime, ensure that you're staying on top of your business matters so that your company doesn't falter while you wait for the sale.