Learn best practice for closing the deal on your business sale with Daltons Business
The day has finally arrived and it’s time to close the deal and hand over the ownership of your business to the buyer. However, there’s still plenty to be done to make sure the transition is smooth, legally compliant, and that everyone involved leaves the table happy.
Today, there are generally three ways to go about closing a sale, each depending on the locations and timetables of the parties involved. These are; the traditional handover where all parties meet to sign and handover documents, an escrow handover that employs a third party to assemble signed documents, or an email handover where all documents and signatures are exchanged digitally with hard copies mailed afterwards.
Whichever approach best suits the closing of your business sale, you will find that some advanced planning and a few useful tips will help the process move forward with as little resistance as possible. Take a look at our guide and make sure you close your sale quickly, efficiently, and to the satisfaction of all parties.
How Do I Close the Sale of a Business?
1. Make a To-Do Checklist
A to-do checklist for closing the sale of your business should be constantly updated until the handover. The date of the handover should also be included on the list to ensure that it cannot be confused or forgotten. Additionally, all parties involved must have a current version so everyone knows exactly what needs to be done on the day. This will ensure that both you and the buyer are working off the same page and that all tasks can be signed off as they are completed.
2. Take Legal Steps to Insure Yourself and the Buyer
The legalities involved in closing the sale of a business are always technical in nature and require an eye for detail. Often, it is a good idea to have a professional on hand to help out, double check everything is in order, and ensure that the correct paperwork is signed by all relevant parties. However, things to arrange and look out for include, a letter of intent and purchase agreement, your own due diligence documents, and the final transfer of ownership documents.
3. Cross Check Payment Details
There’s nothing quite as stressful as waiting to receive a large payment or the first instalment of a payment, particularly when the closing of the sale of your business hinges on it. Make sure you cross check the payment details with the bank and the buyer. Additionally, double check the payment terms to ensure everyone is clear about when, where, and how much money should be paid into your bank.
4. Arrange the Final Walkthrough
A final walkthrough allows both you and the buyer to check that everything is in order before handing over the keys and closing the sale of a business for good. This walkthrough should include the inspection of any equipment or other inventory items to ensure they are present or in the stated condition. Any anomalies or issues that arise during this walkthrough may require some last minute adjustments to the purchase price or the sales agreement.
5. Handover the Keys
Finally, it’s time to handover the keys. Make sure that the buyer knows what each key is for, and provide any other time sensitive information that they might need during the first couple of days or weeks. Additionally, write down any housekeeping information you think the buyer might need. This can be as mundane as what time deliveries usually arrive or when the rubbish is collected, however, it’s often very useful information for new owners.
Closing the Deal on a Business Sale– Final Word
Closing the deal on your business sale can be an emotional and challenging time, not least because of the time and energy you have invested in selling your business and negotiating the terms of the final handover. However, if you have planned accordingly and followed the advice found in our guide, you can look forward to a successful sale without the worry of any obstructions.
Finally, assuming you have the next stage of your life planned and a new challenge awaits, the closing of the sale of your business is a liberating experience that signals the beginning of something new. Make sure you don’t fall into the sellers remorse trap and ensure you use your new found time productively; whatever your plan for the future.
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