Have you been asking yourself how to sell your business?

Here at BUSINESSNAV, we understand that selling a business can seem like a giant leap. That’s why we’ve put together this handy, stress-free guide on “how to sell a business”.

Reasons To Sell Your Business

There are many reasons why you may want to sell. Perhaps you’ve reached that point where you’re looking to experience something new, maybe you’re ready to retire or are no longer able to run a business.

It is important to consider the following points when deciding to sell. Not only do they uncover any weaknesses present, but they also highlight the strengths and any potential points of growth when preparing to sell your business.

  1. What is my reason for selling?
  2. Is the timing right for me to sell?
  3. What potential does my business have to grow?
  4. Does the success of my business depend upon myself or any key personnel?

Now that you have considered the ‘why’, you can consider the ‘how’ and begin preparing to sell your business.

Prepare Your Business For Sale

Organisation is key! Getting all your ducks in a row will provide you with a thorough understanding of your business and reduce the impact of the sales process on your current business activity.

You can begin by:

  • Reducing any risk and uncertainty for buyers. Some examples of this include ensuring that there is a strong management team in place, expanding an online presence, maintaining assets and ensuring they are in good condition. This will significantly assist in increasing buyer interest!
  • Compiling all of your business documents. These include financial records, forecasting, commercial documents, operational information and any legal documents. Not only will this help determine the value of your business, but it will further allow you to identify any gaps and develop improvement strategies.
  • Calculating the market value of the business. This usually involves calculating the value of any inventory or stock the business owns, plant and equipment (digital assets) and goodwill (including intellectual property). It is crucial not to price the business to high or too low! Finding the right advisor will help you to achieve the best price and allow you to continue running your business, stress-free.
  • Advertising your business for sale. In order to showcase the value of your business, you will need to provide as much detail as possible. Highlight the attractiveness of the business, but also don’t hide away from any negatives; it is important to be upfront in order to help buyers better understand and feel more confident in your business.

Selling Your Business

Now that your business is on the market, you will need to complete a few more steps to sell your business:

  • Managing buyer enquiries. As much as buyers do their research into businesses for sale, you should research possible buyers too. Are they just a competitor looking to gain information about your business? Are they serious about making a purchase? Can they afford it? What are their plans with the business? Asking these questions can often be confronting, so this is where advisors can be really helpful.
  • Arranging final sales paperwork. A contract will need to be drawn up, not just including the sales price, but also a settlement period, handover instructions and any other relevant details. This is where you’ll need a lawyer and accountant to check over the document.
  • Handing over the business. As aforementioned, details of the handover are outlined in the contract. For instance, introducing the buyer to employees, clients and suppliers and providing a training period for the buyer.

Your advisor will market your business through a wide list of possible buyers, as well as dealing with any lawyers, accountants and other stakeholders involved in selling a business.

Why Use An Advisor?

Although you can sell your business by your own means, sometimes the help of an advisor is the most efficient way to go and here’s how they can help:

  • Reduce the stress involved
  • Maximise the value of your business
  • Help identify any potential pitfalls early in the process
  • Save your time and energy as they control the sale process
  • Help ensure a good relationship is maintained with the buyer by removing the seller from difficult conversations
  • Liaise with all key parties to ensure a smooth transaction process from engagement to settlement

Now that you know how to sell a business, keep in mind that this process doesn’t just occur overnight. It takes an average of 6 to 9 months to sell a business and if the process is rushed you won’t get the price and results that you want.

Here at BUSINESSNAV we won’t waste your time – We’re here to take the weight off your shoulders, boost your credibility with buyers and give you the best possible price.

How to Sell a Business