Maximising your chances of a successful sale
For business owners to maximise their chances of achieving the best value on the sale of their business, they should adhere to the following simple rules:
Prepare properly in advance of going to market. For example, prepare up to date accounts, tidy up leases and contracts and settle any outstanding litigation and employee disputes.
Do not over focus on pre-sale valuations as they are often a distraction and can distort a seller’s price expectation as against the market reality.
Create a one-page business sales profile for prospective buyers with headline information about your business such as what you do, where you do it, headline financial information, unique selling points, potential for growth and reasons for sale.
Select the right marketing channels to maximise exposure to potential buyers. Remember the internet is not always the best option.
Before sale focus on improving cash flow.
Reduce owner dependence and increase management responsibilities.
Prepare your accounts, tidy up leases and contracts, settle outstanding litigation,
Liaise with professional advisors to discuss best deal/tax structure.
Qualify any potential buyers. Try and find out from the buyer why they want to buy your business, what their experience is and most importantly how will they fund the purchase.
Keep things confidential as leakage about the sale can unsettle key stakeholders such as employees, customers and suppliers. Ensure you obtained a signed Non-disclosure agreement form any potential buyer before releasing any information.
Be prepared for due diligence. Do not be secretive or defensive to questions raised by the buyer.
Apply a lick of paint!
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