Business for Sale
Getting your business ready for sale is a time-consuming and difficult process. Of course, you will want to maximize its value. But, don't cook the books - you don't want to get in trouble for fraud!
Keep in mind that each sale is unique. You want to fully examine your own situation in order to arrive at a fair final value.
Be sure to use objective outside help. If you do this on your own, you may value your company way too low or high. Too low, and you left some money on the table. Too high and you never make the sale.
Preparing a Business for Maximum Resale Value
In most cases, it will take slightly more than a year to find the right buyer. Just because someone makes an offer doesn't mean you have to accept the offer. It may not be a good offer.
One of the difficult balances will be allocating time to keeping your business going and preparing to sell. Put too much time toward selling, and you will soon see your sales dropping.
In general, make sure you have everything in order. If a buyer requests certain information, find and provide it in a timely fashion. Know where all of your receipts are.
Make sure you have a copy of your license, insurance, employee paperwork, and customer contracts. Let go of any employees that are more trouble than they are worth.
Paperwork may be tricky, as you may have attempted to minimize your profits in order to reduce taxes. Now, you have to maximize your profits in order to increase the salability of your company.
Reduce your debt load as low as possible. Or, be sure to be able to demonstrate the debt you have is easily covered by sales.
Make Additional Money During the Sale
Typically, purchasers do not have enough money to purchase in cash. Rather, they will probably need some level of seller financing.
This is your chance to make a little residual income during the process. Just be sure the profitability of your company will cover the costs of paying down debt.
Don't Forget to Instruct Employees and Maintain the Physical Premises
If any of your employees will be involved during the selling process, make sure they present a positive image. Coach them on making only positive statements about the company.
If they are unable or unwilling to be accommodating, remove them from the process. You may consider firing them, but doing so could unleash a nasty lawsuit.
Make sure to also maintain a sharp physical presence. Clean and repair any defects in equipment. The seller will notice you really cared about your company.
He or she will logically assume you took care of all other aspects of your company as well. And, your final selling price will be higher.
After you have done all of these things, you are ready to advertise a business for sale. Neglect even one, and you could end up losing out on a ton of money. Be sure to take every tip seriously.