What You Should Know When Selling Your Business

If you are considering selling your business it is most likely for one of two reasons; because the business is doing well and you want to try your hand at something else, or because the business is not doing very well and you think another owner may have better luck. Whichever situation you are in the things you should know when selling your business are the same.  Look over the tips below to inform yourself of the major factors in selling a business successfully.

 

 

1. Timing is everything

The first thing that you should know when selling your business is related to timing. You need to be aware of the situation of the property market, and the market for your business so that you can sell your business successfully to potential buyers. There will be less interest from potential buyers in a slow market, so you may wish to wait until the market picks up again, or you will have to be very clever with your marketing campaign.

2. Get your business in order

Aside from the question of the market, it is also very important that prepare and have in order all the necessary documents that pertain to your property.  Potential buyers of businesses, more than any other type of property, will be interested in the details of the day-to-day running of the operation and will want to know that everything is in order and will be easy to take over. 

3. Seek legal help

On a related note, another thing to know when selling your business is that it may be necessary to engage the services of a lawyer, especially during negotiations.  The lawyer’s role is to give you advice on legal matters pertaining to the sale and purchase of a business. 

4. Prove your worth

One of the most off-putting factors for potential buyers is to do with credibility. They need to be shown that you are selling a viable and legal business, which they will be able to take charge of and start earning money from with ease. In order to ally their concerns you need to present them with proof that the business is viable. All the necessary documents and papers to do with the day-to-day running of the business must be made available, as well as any other plans, recent renovations, financial evaluations, insurance and stock details which you have in hand.

 

Dison Arnibal has contributed a lot of business related articles with the purpose of building a community of business owners who want to a sell a business online.

Dison Arnibal

Dison Arnibal

Internet Marketing Specialist at For Sale For Lease Pty Ltd


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Trevor Hartshorne

Trevor Hartshorne , Director at Rothlake Business Services

Good points, Dison. Additionally, if you are thinking of selling your business you should start preparing it for sale early - years in advance if you can. Buyers like to look at a number of years of financial statements to makes sure that a whole lot of 'income' has not recently been put into the business and some expenses paid externally to bump up the profit for the sale. Also consider what expenses are coming out of the business that relate to you as the current owner that would be a benefit to a new owner? For example if your business pays for you to go to an annual conference that costs $,5000, either the new owner will have this benefit or can increase the profit of the business by $5,000. If the selling price is a multiple of the profit, that $5000 might turn into an extra $10,000 to $15,000 at sale time. As always, I recommend that you get professional advice early. The money you spend on early advice will be repaid many times over at sale.