Share This Info:  

Can You Sell My Business Without Telling Anyone It's For Sale?


"Can you sell my business without telling anyone it's for sale?" a question California business brokers and agents are asked frequently when meeting with potential small business owners thinking of selling their business.

Owners of small - to medium-sized private businesses are justifiably concerned about their ability to maintain a high level of confidentiality when considering selling their businesses. The main reason is the highly competitive nature of business. You could have an exclusive arrangement with a supplier who, if he became aware that you were contemplating selling, might be encouraged to transfer the supplier agreement to a competitor. Customers who are concerned about ongoing source of supply and continuity of both quality and delivery might be inclined to search for another supplier if it became known that your business was for sale.

Key employees often become very concerned about security and opportunities for advancement if the company for which they're working is known to be for sale. Of course, competitors would just love to know that your business is for sale because then they would be able to go after your customers, your exclusive suppliers, and your best employees.

The most common sources of confidentiality breaches are:

• The immediate family of the seller
• Trusted Friends and confidants
• Employees
• Bankers
• Professional advisers such as law firms, accountants, etc.

Maintaining confidentiality is not a simple task. It is a complex, interlocking process that has to be methodically practiced. The methodology that we believe most successful in maintaining confidentiality is using a business intermediary, an attorney, CPA or some other third party to act as a filter between the owner of the business and the prospective purchasers.

Great care needs to go into marketing materials to ensure they do not provide clues to a purchaser as to which business is for sale. It is also important to de-identify all selling material and documents until the buyer is adequately qualified. Ensuring that all prospective purchasers are qualified to actually receive information about the business is a key part of maintaining confidentiality and should be carried out by your intermediary. A critical first step is to have any prospective buyer sign a confidentiality agreement.

The potential buyer should provide a credible third-party reference (accountant or banker) to attest to his financial capability to purchase the business. Another important aspect of qualifying a prospective purchaser is to establish his or her integrity and reliability. What do the business owner and his or her intermediary know about the prospective buyer? Does the prospective buyer inspire confidence or doubt?

This is an area where a great deal of experience in selling businesses comes in very handy.

If you're contemplating selling your business in the not too distant future, then it's important that you think about what degree of confidentiality will be required. For instance, if you own a gas station or dry cleaner, confidentiality won't be a major concern... Your customers are more interested in your convenient location than in who's running the ship.

That's why you often see businesses such as these advertised openly in the business opportunities section of newspapers. Because selling your business is a complex process, owners of larger companies should plan far in advance for the eventual sale and keep that planning confidential from the earliest stages.

About The Author - Peter Siegel is the founder and President of BizBen.com - Businesses For Sale In California. A nationally recognized author (3 books and a syndicated small business blog) and expert consultant. If you are selling a business and need professional assistance utilizing high performance advertising, marketing, and highly effective strategies, or individual customization with your BizBen Power Search options in buying a California business, you can reach him at 925-785-3118.

Categories: BizBen Blog Contributor, How To Sell A Business, Selling A Business


Comments Regarding This Blog Post


Business brokers take extra precaution to make sure the confidentiality of a business is kept secure. When brokers advertise the business online, they should make sure that there are no distinguishable clues, which a potential buyer could figure out the location of the business, without first signing an NDA. I Recommend, a seller should have something thought out in advance, just in case, someone does say, "Hey, is this the place for sale?" The owner could say, "Hey, for the right price, everything is for sale," and laugh it off. If a seller does meet with a potential buyer, I suggest, possibly meet at a coffee shop around the corner to go over financials or other information and not at the actual business, just in case, someone gets suspicious (i.e., employees).






  Helpful Resources To Assist In Selling And Buying California Businesses
Elizabeth McGovern: Escrow Services - San Francisco Bay Area

McGovern Escrow Services, Inc., is a leading independent escrow company. We are a trusted partner with our clients, assisting them through the tangled bulk sale & liquor license transfer process. We provide attentive, quality & innovative customer service. Phone Elizabeth McGovern at 415-735-3645.

Brad Steinberg, Business Broker: Laundromat Specialist

PWS is the leading laundromat broker in California. Since 1968 PWS has brokered over 2,500 laundromat sales. With over 90 employees dedicated to the coin laundry industry, PWS has 18 licensed agents, a 3 person in-house finance department, 10 service technicians and a 20 person parts department.

Shalonda Chappel-Pilgram: Escrow & Bulk Sale Services - Southern California

Escrow services to brokers/agents, sellers, & buyers. Established 43 years. Extraordinary service. Experienced with handling difficult transactions. One stop for all your escrow needs: Bulk sales, lien searches, UCC searches, liquor license transfers, publishing & recording services. 951-808-3972.

Willard Michlin, CPA, Certified Fraud Examiner, Due Diligence

Willard Michlin, CPA #106752, offers buyers step by step training & assistance in doing Due Diligence Services when they are thinking of making an offer, or are in process of investigating a business purchase. He helps to determine the actual net profit even when there is cash. Call 805-428-2063.

Helen Yoo, New Century Escrow - Escrow Services In Southern California

New Century Escrow, Inc. is a fully licensed & bonded independent escrow company. Over 20 years combined experience in handling bulk escrow transactions. Multi-lingual staff that speaks your language, including Korean, Chinese, Vietnamese. Call Helen Yoo direct at 626-890-1151.

Janet Carrera: Escrow & Bulk Sale Service - SF Bay Area

Redwood Escrow Services, Inc. is a full service, licensed independent escrow company. We are EAFC Fidelity bonded, fully insured & licensed with the Department of Corporations. Committed to offering our clients the most comprehensive variety of escrow services available. Phone Janet at 510-247-0741.

Diane Boudreau-Tschetter: Escrow & Bulk Sale Services - CA

California Business Escrow, Inc. is a full service independent escrow company serving all of California and has expertise in a wide range of escrows. Our team prides itself on providing an exceptional escrow experience. For more info phone Diane Boudreau-Tschetter at 888-383-3331 or 209-838-1100.


  Related Articles, Events, Blog Posts, Discussions, Videos, Interviews
How To Determine Whether The Buyer For Your Business For Sale Is Sincere

A problem owners encounter when offering a CA business for sale is that not all so-called business buyers are qualified to make the purchase. It's frustrating and costly to waste time showing non-qualified buyers the business. Here are ways to identify time wasters so the focus is on real buyers.

Buy A Business Or Start From Scratch? 5 Key Differences For Business Buyers

Some buyers believe it's better to start a business from scratch rather than buy an existing enterprise. While this may be good advice in some cases, usually it's not the best strategy. Here are five tips to help a buyer make the right decision from from Peter Siegel, MBA (BizBen Director).

Valuing A Business - Do You Add The Inventory Amount To The Price Or Not?

A business buyer asks how to handle the inventory amount in the purchase price of a business. Do you add the inventory value to the business value? Peter Siegel, MBA (ProBuy & ProSell Program Advisor - Lead Facilitator ) answers this question with the BizBen Network of advisors and resources.

If You Plan To Offer Seller Financing: 3 Things Owner Sellers Need to Know

When selling your business, offering seller financing is a great way to help your business standout from others on the market and it is also a good strategy to consider that can help you close a sale. Peter Siegel, MBA (BizBen ProSel Program & Financing Expert) explains. Reach him at 925-785-3118.

Unreported Income: Should Sellers Disclose Unreported Cash To Buyers?

Should owners who offer a business for sale reveal to prospective buyers any income that is not recorded in the books? This is a controversial topic with arguments both for and against. Most business sales intermediaries believe if you don't pay tax on it, you can't claim it. Some sellers disagree.

The Bottomline: What Exactly Is Adjusted Net Income, SDC, And Cash Flow?

The use of add backs & adjusted net income is common among sellers of businesses when showing their financial information/performance. But buyers are cautioned to review financials and tax returns/documents closely. Peter Siegel, MBA with BizBen (ProBuy & ProSell Advisor, Lead Facilitator) explains.

Thinking Of Selling My Business: What Factors Create Value And Drive Price?

There are a lot of misconceptions about what enhances the value of a business. The following factors in this Discussion Post on BizBen are aspects of a business that really drives its value and pricing. Business owners thinking of selling should check these out these factors before selling.

Buyer Beware: Does A Company's Culture Effect The Sale Of A Small Business?

When purchasing a small to mid-szied CA business, there are a many items to evaluate. One area that is often overlooked is the business's office culture. Peter Siegel, MBA with BizBen discusses with business buyers the importance of understanding how the business "feels" on a day-to-day basis.


Escrow Services Diane Boudreau-Tschetter
Inland Empire Area Business Broker Mani Singh
SF Bay Area Business Broker Manjit Singh
Veld Group Business Brokerage Los Angeles County
Facebook
Twitter
Linkedin
Vlogs and Podcasts
Instant Email Alerts On BizBen
BizBen Blogs And Articles
Business For Sale California Stats
California Educational Events Buying And Selling Businesses
BizBen ProBuy Program
New Postings Reports On BizBen Sign Up

BizBen - Where California Deals Get Done! 888-212-4747
7172 Regional Street #364 · Dublin, CA. 94568
BizBen · Copyright © 1994 - 2019, All Rights Reserved



Clost Login


Please confirm your registration by clicking the link we've sent to .

If you can't see it, please check your junk mail folder.

If you have any problems registering, or need assistance with your new BizBen User Account please phone BizBen Customer Support at 888-212-4747.



First Name:*
Last Name:*
Email Address:*
Confirm Email:*
Create Password:*
Confirm Password:*
Phone:
(   
 


You Are A:
Individual
 
Intermediary
 

Email Address:
Password:
 

500 New & Refreshed Detailed Postings Daily
Over 2500 Resources Available On BizBen
Since 1994. Where California Deals Get Done!
Buyer Beware: Does A Company's Culture Effect The Sale Of A Small Busine...
Read More News
Top 100 List: This Week's Top Motivated Business Buyers & Their Requests...
Read More News