The process of selling a business can take more than a year to complete. To make your exit strategy successful, you should keep it in mind. Below are some steps which you should go through to make sure that your business is ready to be sold:
1. Calculate Business Price
First of all, you should obtain and get a realistic idea from CBC Business Sales about how much your business is worth. Their professional appraisal for your business will give you an idea of gauging what buyers will offer and will also get to know the idea of net from the sale of your business. You will also get to know the pros & cons and market position of your business. You can also improve your business’s weaknesses before putting it on sale, so that you can get a better sale price.
Easiest valuations can be made by contacting CBC Business Sales directly, or you can use their “Business Price Calculator” and they will get back to you instantly in this regard. Business Brokers Sydney is a smart choice as they have access to the most current national data, regarding privately held transactions in your type of business. They also have experience in selling businesses & firms of all kinds. So, it will be really helpful for you in selling you business.
2. Sort out your Books
Buyers, who are looking into your business, ask for at least three years of financial record / information. The more presentable and formal your statements, the better will be the impression which you will make on buyers. Along with that easier would be the due diligence for buyers. Tax returns may be enough.
3. Realizing the true Profit of Business
Mostly, privately held businesses have different types of non-operational expenses. For instance, your business may be paying for the personal automobile lease of yours. In such cases, just try to make sure that you have proper supporting documents for such expenses.
In addition, these may be non-frequent spending you have incurred in past three years. There may be moving expenses in case you have moved to a larger or better facility, or there maybe any legal expenses. All of these should be excluded in a buyer’s analysis of repeated cash flow.
4. Consult your Tax / Financial Advisor.
It would be a smart decision to consult your tax / financial advisor by keeping the aspect of selling your business in mind. It will help you to understand the tax situation of yours as well as of business.
5. Make the first impression Good
What will the buyer, who visits your shop for the first time, see? Order or chaos? Prospective Buyers look for businesses which look well. No doubt, and ordered or well looking shop represents a fine management team and orderly back-end operations.
6. Organize Legal Paperwork
Make sure that you have current legal paperwork readily available and in order. For instance, review your permits, leases, incorporation papers, licensing agreement, customers and vendor contracts etc.
7. Consider succession plan
If you yourself is the business, or do not have any people or staff able to help the new buyer to run the business after you have left, who will the new buyer turn to, for help? That is why you should have a proper succession plan in place before putting your business on marker for sale.
8. Keep the Reason for Selling in mind
All of the buyers are curious about why the seller wants to exit or leave the business? So keep the reason for selling in mind and be ready to articulate your reasons.