Selling a Business| Mergers and Acquisitions

Selling a Business

Selling a business, which may be your most valuable asset, is a complex process. You will first need to make your business ready for the market by preparing your financials, leases, staff, supplier agreements, contracts, customer data base and much more. When it’s time to sell, you need to know how to sell, who to sell and what’s it worth. Lack of expertise and knowledge about selling a business, would make it difficult, overwhelming and time consuming for you to do it yourself.

The Process of Selling a Business

If this is the very first time you are planning to sell your business, you might want to ask yourself the following questions.

What does the selling process entail?
Are my financials UpToDate?
Is this the right time to sell?
What is my ownership structure?
Should I do an asset or stock sale? Have I compared the tax consequences?
What time frame do I have in mind to sell my business?
Should I provide owner financing and accept a note?
What distinguishes my business from my competitors? What are the differentiation factors?
What patents and trademarks do I own?

What is the value of my business and how much a buyer will be willing to pay?
Should I use the services of a broker or sell it myself?
What are the advantages of hiring the services of a business broker?
How do I contact buyers discreetly, without competitors or employees knowing?
What plan of action should I follow to sell quickly and make it more desirable to buyers?
What is Due Diligence and why is it important?
Will the new buyer/employer be fair to my employees?

Factors that Increase the Value of the Business and Make it More Attractive to Buyer

Financial Strength – Businesses that generate more profits are more attractive.
Growth Potential – Buyers like business which has significant growth potential.
Good Management Structure – Buyers would prefer a business which runs by itself with minimum owner interaction. Allows the owner to be more involved in more strategic decisions such as growing the business.
Not Overly Dependent – Should not be overly dependent on one (or a few) customers or vendors or an employee so that losing that customer or employee or vendor could deeply hurt the business.
Does not Require Major Cash Injection – The business is cash flow positive and able to run itself from Cash flow generated month after month. Ensures that customers pay quickly, have favorable payment terms with vendors and quicker turnover of inventory.
Recurring Revenue – It is best if one can keep earning regular revenue from customers. Getting new customers is more expensive and time consuming and so recurring revenue from existing customers is very attractive.
Having Something Unique or Proprietary – If your business offers something unique or proprietary, it will stand out from the competition and will become more desirable.

Buying a Business

We present business opportunities with information that we believe is accurate and reliable. We work closely with and buyers to ensure a smooth transition period. Sellers typically look for buyers that they will be proud to introduce to their vendors, staff and community. We work with them by vetting prospective buyers. We make every effort to match buyers and sellers in business acquisitions.

Selling a Business| Mergers and Acquisitions

Selling a Business