Are you considering buying or selling a business? Pivoting, forming or scaling your small business?
Selling companies and moving on to better things is a natural part of entrepreneurship. As rewarding as it can be to own a company, it can get to the point where it’s not sustainable. In that case, one of the best things you can do for your entrepreneurial journey (and the business itself) is to pass it on to someone else.
If you’ve been flirting with the possibility of selling your business but are not sure where to start, you’ve come to the right place! Consider these fundamental tips from As Your Counsel:
Look for the Signs
Suppose you are not entirely sure it’s time to sell your business; learn to recognize clear indicators. For example, if you are burned out by what you do for your business or discover that there are more and more risks your company is facing, it is likely it could be time to pass it on.
Sometimes, positive developments can indicate that selling your business could be beneficial. If your life goals have changed, if you are nearing retirement age, or if your company has become more valuable than you ever expected, then selling it to the right buyer can be a common-sense solution.
Get Ready for the Sale
If you have determined that selling your business is the right thing to do, you must prepare yourself for the process. Start by boosting your company’s revenue and profit as much as possible, and make sure your bookkeeping is well-organized and maintained.
While you’re at it, be sure to resolve any legal or financial issues so that they don’t surface during due diligence.
Start Courting Buyers
Next, it’s time to start finding the right buyer for your company. Understand the difference between the different types of buyers who might show interest. You will probably get the highest price from a strategic buyer who will buy your company to improve the financial situation of their own business.
On the other hand, a financial buyer will buy your business to enhance it and potentially sell it later. Then there is the operator buyer, which hopes to buy your company so that they can run it and build their income and life around it for the foreseeable future.
Potential buyers can come from any number of groups, including employees, suppliers, customers, competitors, investor groups, friends, etc. Look in the right places to find a buyer you are comfortable with. Networking in and outside of your business circle is a great way to start finding reputable buyers. But you could also benefit from accessing peer groups, industry organizations, and online listing services.
Consult Professionals
Finally, consider working with a professional to ease your stress and make the whole business selling process smoother. As Your Counsel will:
● Structure the transaction.
● Negotiate and help explain material terms.
● Advise you on limited liability.
● Handle lease assignments.
● Draft an asset purchase or stock transfer agreement.
● Seller’s financing documents.
● Manage the closing and post-closing tasks.
We offer free consultations and flat-rate packages. https://www.aycpdx.com/small-business