Selling a small or medium size business is a complex undertaking. There are many considerations that require attention while your business still requires your time so if you are stretched for time now, selling will add to your daily activities. You might want to hire a business broker to handle the bulk of the transaction.

You will also need to spend more time with your accountant and attorney. Your attorney will be creating or reviewing contracts, your accountant will be preparing financial statements to be forwarded to the buyer’s lender or bank. Depending on the time of the sale, you may want to offset some of the income or investigate how to minimize or eliminate taxes.

In any case, you should develop a plan to handle the sale. A good business broker will have a plan and be able to take you from owning the business to being a previous business owner.

1. Why Should I Sell

   There are many reason one might want to sell a business. Rarely it is just a simple, “I just want to sell and do nothing”. There are a variety of life events that cause owners to sell good businesses.

   • Retirement – business owners wishing to retire come at many ages. Some are in their 60’s, 70’s, and even later.
   • Other Business Interests – we see many business owners who get involved in another business thinking they can run multiple business until they find out that it is too much of a headache.
   • Medical Reasons – health and illness, even death cause owners or their estate’s to see a business
   • Partnership Breakups – life issues come into play. Partners start out on the same page with the same goals but life gets in the way and a partner has different goals forcing a break between the two.
   • Burn Out – some owners just get burned out because owning a business is more than a full time job. There are litterly thousands of decisions each day that have to be made. A little known fact about running a business.
2. Time for the Sale
   
   When is a good time to consider selling a business? When profits are moving up for a few years, numbers areconsitant, you have built a strong loyal customer base, and the business climate for this industry is positive. Trying to sell abusiness when profits are down or flat for the last few years causes the business owner to fund the sale him/herself as banks and lending institutions flatly refuse to lend in those circumstances.




3. The Business Value
   
   Your business might be Very valuable to you but to someone else, that is a different story. It goes across the gambit. Someone might see value in your business and appreicate your hard work and that is a good buyer if they are qualified to take over and grow the business. There are buyers who don’t appreciate your hard work and a good business broker will weed them out so you don’t have to deal with them. In any case, someone will determine a value for your business along with yourself and possibly your accountant. You can hire a business appraiser to get a valuation. You will want to make your own assessment of the business. Be aware, there are guidelines to this process and if you price it out of the picture, prospective buyers will not even inquire.




4. The Sale Process
   
   As business brokers, we’ve gone through the process many times and we know how to guide prospective buyers to a successful sale. We take into account several key business issues and make a determination on how best to market your business. We look at the industry, your financials, your operations, and other key items to assess the marketability of your business. We then create a marketing flyer and a projected profit/loss statement for the new owner so the buyer will have more confidence in their decision to purchase. We step them through the process and handle the interaction between buyer and seller to smooth over any rough edges that might come up during negotiations. Our goal is to create an environement of success.




5. The Buyer/Prospect
   
   Buyers come in all forms. Some buyers were downsized from corporte America and think they can run a business but they were mainly technicians and never had to deal with the miriad of issues a business owner faces on a daily basis. Other buyers have experience directly in your industry or a related industry. They are good buyers. We look for a qualified buyer and we know how to qualify them at each step during the process. A good buyer will be able to make a positive determination based on ourassessment and documentation we create for your business.




6. Reaping the Rewards
   
   Once you sell your business, it’s not over. What will you do with the profit? Reinvest, collect interest and retire? We help you keep as much of the proceeds as possible. Make sure you ask us how to protect most or all of your proceeds so you can minimize the tax implications.

Selling your business is time consuming and requires documentation (agreement of sale, bill of sale, assignments of lease, security agreements, etc.) to be created for marketing your business. It requires professionals to help most of the time. The sale shouldn’t be emotional adventure. The business broker will help smooth out the rollercoaster ride you are expecting to take on.