03 Sep Fundamentals of How to Sell a Business
Many sellers jump into the process of putting their business up for sale, without understanding the basics of how to sell a business. Let’s take a closer look at some of the most basic things you’ll want to do before you get started.
Figure Out Your Reasoning for Selling
First of all, before we get to how to sell a business, we must first think about why you are selling in the first place. It is vital that you have a very clear reason in place. Quite often, sellers don’t think about the fact that buyers will want to know why a business is being sold.
After all, if you were buying a business wouldn’t you want to know the reasons why a business is available? In short, you’ll want to be able to clearly articulate and outline why your business is up for sale.
Presentation always matters, and this is doubly true when it comes to selling your business. That means you’ll want to have all of your business materials well organized and ready to go.
When it comes to the basics of how to sell a business, working with a great accountant is a very prudent move. You may pay a premium for your accountant, but in the end it will be worth it. You’ll want this accountant to review your tax returns for the last four years and review your financial statements as well.
You’ll want to have the following key pieces of information available:
-profit and loss statements
-current balance sheet
-lists of customers
-patents if relevant
-current profit loss statement
-list of equipment and assets
-property appraisel or lease
Determining the Value of Your Business
Before your business can be put up for sale, it is essential that you determine its value and are prepared to back that value up with tangible facts. Bringing in a business broker to assist you in the process is extremely important, as that person will know all the “ins and outs” of how to sell a business.
You’ll benefit from working with someone who possesses a wealth of expertise and understands what is necessary to establish the right price for your business. The document that is created for you will benefit you later as well, as it can be used as a powerful negotiating tool.
Business Brokers Possess Essential Experience
There is another key reason to opt for a business broker and that is your time. The bottom line is that you still have to effectively operate your business during the time period when it is up for sale. A business broker will handle the sale of your business and all the complexities that go along with it, while you continue to operate your business. At the end of the day, this is a win-win for all involved.
The bottom line is that selling your business takes patience and preparation. Selecting the business broker to help guide you through the process will serve to dramatically increase your odds of selling your business and selling it for the right price.
Copyright: Strategic Business Brokers Group