General Information Regarding Selling Your Business

By: Aaron Muller

In today’s marketplace, the sale and purchase of businesses occurs quite often at all different levels including anywhere from small, privately owned companies to large corporate conglomerates. Regardless of the type of business one owns, there are a few tips one should follow when selling their business. The following paragraphs will highlight some of these handy guidelines.
Make the Necessary Preparations
Prior to the day in which the business changes hands, it is important that the soon to be ex-business owners take the necessary steps in order to ensure that the transaction goes smoothly. This should be done before the individual business owner even finds a buyer for the business as a company that can stand on its own, independent from the current owner, has an extremely attractive quality to it. Therefore, it is important to make the business as self-sufficient as possible prior to the sale.
The Asking Price Should Be Reasonable
Although most individuals would like to get as much money as possible for their business sale, it is crucial that the current owner of the business present an asking price that is a reasonable one. Not only will a reasonable price attract a good number of potential buyers but it shows the mindset of the current owner as well. Dealing with a fair individual is something that most people would like to do when it comes to business purchases.
Present Current and Clear Financial Documents
At some period during the sale discussions, the potential buyer will want to know quite a bit about the financial background of the company itself. Questions regarding annual revenue, expenses and so on will be asked and for this reason it is important that the current owner of the business has the answers to those questions. The best way in which to have the answers prepared is to use a spreadsheet method which clearly and concisely lays out all of the pertinent information so that the potential buyer can understand the background of the business.
Remove Items That Are Out of Date and Not In Use
Another tip for current business owners to keep in mind when they are trying to sell their business is to remove any equipment from the office which is archaic or not in use. By clearing these items out of the office area, it makes the office look much more presentable to potential buyers who may stop by to see what type of business is being run by the current owner.
Maintain Usual Business Standards and Then Some
From time to time, when business owners know that they are going to be selling their business in the near future, they may tend to relax a bit and not keep up with sales as they used to. This can be detrimental to the current owner, especially if they have not obtained a purchaser at that point in time. Keeping the business in good running order, if not better, is the best way to help aid in the sale of one’s business. A prospective buyer usually wants to purchase a business that yields good returns and has a good reputation with the general business market. Therefore, maintaining one’s business standards to the best of their ability is extremely beneficial to the current owner of the business.
Keep the Potential Sale Confidential
Keep in mind that a sale is not final until all of the necessary paperwork has been signed. Therefore, it is crucial that while the sale negotiations are taking place the current business owner does not leak the news that a potential sale may be in the works. Doing so may not only hinder the current deal but scare employees, customers and other business associates. Confidentiality is something which the business owner should maintain at all costs.
Review All Aspects of the Deal
Although the price of the sale transaction is what really peaks the interest of those participating in the sale, it is extremely important to review and know about all of the specific details regarding the deal. As the price is only a small portion of many business sales transactions, it is pertinent for the business owner to review the sales agreement to know what the end result will be.
Seek Professional Advice
Lastly, business owners who are looking to sell their business should do all that they can to obtain professional advice regarding the business transaction. Accountants, lawyers and business brokers are some of the various parties which business owners should consult before, during and after the sales transaction to ensure that they are covered every step of the way.
Business owners who take heed of the previously mentioned tips may find that the sale of their business will flow that much more smoothly throughout the entire length of the transaction.