A checklist guide for selling your business
How do you go about selling a business? There are lots of steps to consider but we’ve compiled a simple 25-point checklist for selling your business, to help you when preparing your business for sale.
1. Know why you’re selling your business. Anyone buying a business will want to know why it’s on the market. So let them know why you’ve put your business up for sale.
2. Think of all the good things. You’re the best person to sell your business to a potential buyer. You know what makes it great, so jot them all down now!
3. Get your house in order. Is there anything that would put someone off buying your business? If there is, you need to sort it out before advertising your business for sale.
4. Resolve disputes. Do you have any ongoing complaints or disputes with customers, staff or suppliers? If so, these must be clearly documented or, ideally, resolved.
5. What business are you selling? Are you selling the legal entity of your business as a share sale. Or are you selling off some or all of its assets in an asset sale?
6. Take financial advice. There are several ways to sell a business, and some will be more tax-efficient than others. So do your research and speak with your accountant.
7. Who will help me sell my business? Most vendors choose a business transfer agent to help them sell a business. They’re the experts, but they charge for their expertise.
8. Can I sell my business by myself? Yes, and if you handle the business sale yourself you might save some money too. Of course, you can always list it on DaltonsBusiness
9. Be realistic with your time. A business sale takes effort, so if you’re busy maintaining operations, then leave it to the experts to help you sell your business.
10. Carry on as normal. You’re selling your business as a going concern, so keep it going. Maintaining, or even growing revenues, will get you the best price.
11. Know what your business is worth. How do you value a business? There are several methods so it’s probably best to call in the experts. Many offer this service for free.
12. Get your premises ready to sell your business. Tidy up everything and make sure all equipment, fixtures and fittings are in good working order.
13. Grab a copy of your lease. How many years are left on your lease, how easy is it for the lease to be transferred, and what terms apply when you sell your business?
14. Decide what to do with your building. If you own the property, you could rent it to the new owners. A leasehold sale makes it more affordable to a wider audience too.
15. Know your business rates and running costs? No doubt you know what all of these are, as you’ve been paying them for some time. But go through them again.
16. Identify all your overheads. A buyer will want to know everything, so have all your overheads in a clear, presentable format to share at the appropriate time.
17. Think about your staff. When should you tell your staff you are selling your business, and what implications does it have on them? Take legal and HR advice on this.
18. Get your paperwork prepared. Do you have your company’s certificate of incorporation? Is your logo trademarked? What about employment contracts?
19. Know your liabilities. Do you have any maintenance contracts or lease agreements on equipment, vehicles or machinery? Are there any outstanding loans to pay?
20. Engage a solicitor. It’s likely you’ll need to instruct a solicitor when you come to sell your business, so choose wisely and budget accordingly to pay for the privilege.
21. Get your accounts up-to-date. A buyer will want to know the financial performance of your business today, not just what it achieved last year and the year before.
22. Have a least 3 years’ accounts to hand. Demonstrate a strong financial performance over several years and you’ll be able to sell your business for the highest price.
23. Prepare an Information Memorandum. This document will have everything a keen buyer wants to know. And, put together properly, will help you sell your business.
24. Be confidential. Don’t share everything with everybody, after all some of the information is sensitive. Have a Confidentiality Agreement signed before disclosure.
25. Be honest too. You need to share real facts and figures, so don’t hide anything. It could catch up with you, and might mean financial and legal ramifications.
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