Selling a Small Business
If you think selling a small business is easy, it’s not. You would be surprised that less than 30% of all businesses put up for sale actually got sold. Owners, brokers and agents do not have it easy but there are preparatory steps which can be done to increase the chances of selling a sb.
1. Prepare All Records. Make sure to have all documents in the last three years ready before putting the business in the market. These would include tax returns, financial statements and reports (profit and loss; balance sheet), monthly bank statements, lease contracts, list of all equipment and furniture being sold.
2. Get an Appraisal. Seek professional services to ensure that the appraisal is accurate and competitive. The last thing you want to happen is to over-price and risk no one buying.
3. Keep Contacts Intact. Have a record of all interested buyers and all their contact information. It will be helpful to have a back-up buyer in case the first ones back-out.
4. Prepare Confidentiality Agreement. Make sure that all potential buyers understand and sign this document before disclosing any information to them.
5. Maximum Exposure. Make sure that it is clear to the public that the business is indeed up for sale. Be prepared to allocate money on marketing or advertising expenses.
6. Pre-Qualified Financing. Take your offer a step further and make sure that your buyer will not have difficulty in finding a lender to fund the business after the sale.
7. Keep Negotiations Moving and Communications Open. It is crucial that everything is clear to both parties and that negotiations will not take too long to close as buyers may lose interest.
Perhaps, one last thing to do when selling a sb is to maintain a positive attitude. Believe that it will happen. Believe that the company will be sold to a good buyer. It may not happen overnight, but it will.
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