If you’ve come to the conclusion that selling your business is the only viable option for you then ensuring a profitable sale is paramount - a developed business will be attractive to prospective buyers.
Here are some important questions you need to ask yourself when making a decision about selling your business.
Why are you selling?
Buyers will want to know this so prepare a truthful and transparent answer. You will want to assure potential buyers that you are not selling for reasons that could leave them at a loss, for example liabilities, indemnity claims or other risks to the business. They will also want to know that you have no plans to set up in competition to them.
Is it the right time to sell my business?
Many people wait until their business is on the decline before they sell; if you have a choice over when you sell your business then selling when the business is failing is the exact opposite of what you should do. If you can then you should aim to sell your business when it is at the top of its game therefore making it more appealing to prospective buyers.
Is the market right?
Look at the current market conditions in your industry. Could the market and sale price improve if you waited? Take a look at what happened to the housing market – selling a home improvement business in 2006 would have been a good decision, but fast forward a couple of years and such a business may not have achieved three quarters of its original price.
Is your business ready to sell?
Are your books in order? If you are definitely going to sell then you need to ensure that all the paperwork is in order to show maximum profitability and to get the best price for your business. You can’t start putting things together a month before you intend to sell.
What are potential deal breakers when selling my business?
Make sure that any unresolved issues don’t rear their ugly heads and interfere with a sale, especially in areas such as company ownership, accounting or intellectual property rights.
It is important to seek professional legal advice before making such a big decision in order to achieve the best possible outcome. Whether you’re selling your company as a going concern or selling business assets, a skilled lawyer can guide you through the entire process. For more information about selling your business, click here.