Would you like to retire? Relocate? Just want to cash out?
Before you begin, review the ten things I learned from my experience...
1. Use common sense when hiring a lawyer.
While it's important to have an attorney review most documents, getting your lawyer too involved may do more harm the good — particularly if he intimidates prospective buyers.
2. Use a reputable broker
Resist the temptation to save a broker's commission by selling yourself.
A good broker will have a large data base of prospective buyers. Therefore, he can often sell your business for a higher price — getting more than his commission. What's more, he can sell your business quickly and bring years of experience that will smooth out a million bumps and hurdles.
I was extrememly impressed with my broker. If you would like his name and contact information, send me an e-mail at 1492@teacher.com or call me at 1-812-372-1663 — ask for Kenny Paul.
3. Get your financial records in order
Any reputable buyer will expect to scour your financials. Be sure you have them in order and can answer questions as they arise.
4. Get your legal documents in order
These include such things as contracts, supplier contracts, staff contracts, patents, trademarks, advertising contracts, and so on.
5. Think like a buyer
Look at your business from a buyer's perspective. See anything that you don't like? Make changes whenever possible. And keep in mind that first impressions are always lasting.
6. Prepare to train the new owners
The new owners will need to become familiar with your day-to-day operations. Before you sell, be thinking of how to train the new owners.
7. Ask high; but sell at a fair price
Expect potential buyers to pay no more than your business is actually worth. While you can always come down from your original asking price, you can never go up. Consult with your broker. (Hint: If a broker wants to charge you for an evaluation of your business, DON'T HIRE HIM. An honest broker can calculate a reasonable asking price by reviewing your two-year financials. And he won't charge you a dime.)
8. Don't over-negotiate
By holding out for the very best price, you may end up losing the sale altogether. Dragging out the negotiations benefits no one.
9. Put everything in writing
Protect yourself and expect your buyers to protect themselves. It's just good business to make sure essentials contracts are written and signed. Again, a lawyers review may be in order. Your broker will know exactly the contracts that need to be signed.
Hit the golf course, move to your new location, start the new business...whatever it is you had in mind, say so long to the business and get on with the good things in life.
