Client Checklist: Is Your Client Ready to Sell Their Business?

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There’s nothing worse than waiting for the last minute to do something and then knowing you either missed the boat or got on the boat with the leak. Well, it’s often similar with entrepreneurs when they decide to sell their business. They either wait until a life event like illness or death forces them to make a decision, or fail to prepare far enough in advance of their desired departure from the company.

To help your entrepreneurial clients understand where they are on the road to selling their business, we’ve developed a checklist of sure signs that it’s time to start the process. Ideally, companies should be asking themselves the right questions as far out as 5 years from their hopeful date of sale. Start early, be prepared, and get ready for smooth sailing.

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6 Answers Every Buyer Needs to Hear

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6 Answers Every Buyer Needs to Hear

Ready to sell?  Be prepared to answer some important questions.

 

Selling a company means being prepared to answer tough questions from potential buyers. It's important to be confident, be prepared, and have all of your company's relevant information available to disclose. Assume that the truth would be uncovered during due diligence, and offer it freely. This will build trust and contribute to a speedier transaction.

 

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Four Tips to Profit from the Sale of Your Business

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Four Tips to Profit from the Sale of Your Business
by Bryan Popowich

As part of my business I've helped hundreds of entrepreneurs buy or sell businesses. If you're thinking of selling your business, there are a lot of things to be considered, planned for and implemented - months and even years prior to your intended target sale date.

1. Surround yourself with good advisors. I always remind entrepreneurs to surround themselves to do this, and to ensure everyone is looking out for your best interest. Make sure these advisors communicate with each other - this is key to ensuring that any transaction you complete will be smooth and efficient. There are costs to having advisors assist with your sale, but compared to the costs if things are not done properly, it's a very worthwhile investment.

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STEP-BY-STEP TO SELLING YOUR BUSINESS

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Putting off starting the process for selling your business?

Much like other things that are " unknown" we tend to put them on the back-burner because we're not sure how much effort, time and preparation will be necessary. Business owners are busy people.

it's a very manageable process when you look at it from a step-by-step perspective. Enlisting good help along the way can make it even easier.

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Adding Value To Your Business

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If you’re looking to sell a business, it’s critical to look at the value of the business.  But, a typical business really has two values.  The academic value is the one determined by a professional business valuation.  The other is the true market value.  The academic value is arrived at with a formula based on the firms’ hard assets, cash flow, industry averages and multiples.  Fair market value also takes those items into consideration, but then considers what buyers are really willing to pay. 

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Valuating your business - why a professional valuation goes beyond the basics

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Valuating your business - why a professional valuation goes beyond the basics

We often see clients that are unsure about what their business is worth when they decide to sell. They approach this task similar to what one may do when pricing a home, by looking at market comparables. For example they may look at what other competitors or other businesses for sale are priced at online, or perhaps look at factors such as their own revenue growth or assets, trying to judge what the price would be for their business. Unfortunately, it's not quite this simple if you want to get the maximum fair value for your company.

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A Glance at the Buying Process

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For many, buying a business is a major decision and one that you may only do once in a lifetime. It is exciting and daunting all at the same time, and requires some peace of mind . This peace of mind can come from a structured and proven process to buying a business.

By working through a Business Broker, you will get complete information on every listed business. This includes details about the marketing, operations and human resource components of the business and a thorough financial depiction of the business.

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Part 3: Important Things to Know Before Selling a Business

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Part 3: Important Things to Know Before Selling a Business

Statistics show that sellers who ask for all cash receive, on average, only 70% of the list price, while sellers who accept terms typically receive 86% of the list price.

In many other cases, businesses that are listed for all cash just don't sell.

So, it's clear that by offering some financing in the sale of a business, that an owner can increase the selling price they will receive. Here's a breakdown of how these concepts interplay:

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Part 2: Important Things to Know Before Selling A Business

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Part 2: Important Things to Know Before Selling A Business

You've made the decision to sell. Now what should you do?

It is imperative that you understand why confidentiality is important to the successful sale of a business and what can happen if a sale is prematurely announced.

Confidentiality throughout the sales process is important for many reasons, some include: staff might start considering the stability of their employment and look elsewhere, customers may lose confidence in the business, competitors might capitalize on the news and do something detrimental to your business or creditors may push for earlier payment due to the unknown future.

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