There are many approaches to selling a business, but the one rule that is in every 'how to manual' is to start planning early. Nothing will unlock the value of your business better than planning your exit well in advance. Quick sales are fire sales with the purchaser usually picking up a business for less than its true value.
Planning to sell your business should start at least 6 months in advance. Here are just some of the questions you should be able to answer before you decide to sell;
- Are you and your expertise critical to the commercial success of the business. Can the business run effectively without my presence?
- Establish any conditions for the sale of your business regarding your involvement, e.g. do you wish to stay on as a manager/employee after the sale or retain some equity in your business? Am I prepared to stay on after the sale of the business for a period of time?
- Identify potential buyers that you may already know, e.g. family members, employees, competitors or suppliers. Do any members of my family wish to take over or carry the business on?
- If I have a registered trademark, do I want to retain it?
- Can my business licenses be transferred to a new owner?
Your Accounting/Tax advisor should be your best resource to help prepare of your business exit and along with legal advisors they should be consulted at the start of your 'Planning Your Exit Strategy'.
Areas your accounting/tax advisor should help with are;
- Address capital gains tax issues to optimise the proceeds of the sale
- Restructure the business if necessary to optimise it for sale
A good idea if you are looking to sell your business you should start thinking about it from how a purchaser would approach buying a business.
Prospective purchasers should only buy a business after conducting due diligence, which means getting and analysing all the information you need to decide whether to buy and how much the business is worth. This should include getting an independent business valuation.
We can help in the planning options, the presentation of your business to present it as an attractive package, which could add substantial value to your business. Selling a business has many different stages. With our experience in small business we can add value of the importance to detail, we will give your buyers the right financial presentation of your business.
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