If you are a small business owner thinking of selling your company you need to be realistic on how the sale will move forward. You need to put just as much preparation into the sale of your business as you did when you started it. A seller needs to be optimistic about their expectations, but realistic as well.
Sellers should answer the following questions as a way to determine their expectations of the sale of their business:
Why are you selling? Is it for personal reasons or are you looking to retire? Perhaps it is the economy and you want to showcase the fact your business is doing well. Whatever the reason, be sure you know why you are comfortable with your reason so you don’t change your mind when a buyer makes an offer and reality sets in. Knowing why you are selling your business should be a part of your exit plan.
What are your expectations of the sale? Having an idea of the price you are expecting or needing to get for your business and what kind of timeframe you want to sell in is also important. Hottes says sellers need to have a thorough valuation of their business completed so they are putting a realistic price on the business. Current market conditions are outside factors that also need to be taken into consideration. A valuation by an outside party, such as a Certified Business Broker, will provide you with a realistic picture of what you can expect in the way of price.
What does your ideal buyer look like? Think about the qualities you feel the buyer of your company should have and what kind of offer they would be presenting. Is the buyer looking to continue to build on your success? Will the buyer be a good fit for the staff you leave behind? There is also a new kind of buyer out there - some laid off individuals are looking to buy a business as an alternative to traditional employment and some boomers are looking for a business that fits their lifestyle while providing financial support during retirement.
Sellers also need to consider how much they will be willing to negotiate and if they are willing to consider seller financing. With the economy they way it is, if a seller wants to get their business sold, they may need to consider alternatives.
Who is going to help you? Just as you can’t run your business in a vacuum, you can’t sell your business in one either. It takes a lot of preparation to get a business sold, so enlisting help from a team of experts is key. Tap your lawyer and accountant to help prepare financial and tax records. Sellers should also use a Certified Business Broker to connect them with serious buyers and assist in negotiating offers. Having a team in place can help you reach your selling goals.
About The Author: Ron Hottes, with Business Team has a business brokerage team of 42 highly skilled and seasoned professionals with offices in Torrance, Woodland Hills and Newport Beach. Our business brokers have over 100 years of cumulative experience and the expertise to help you buy or sell a business in the Los Angeles County area. Reach him by phone at 310-539-8300.
|Helpful Resources To Assist In Selling And Buying California Businesses|
|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.
|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.
|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.
|Chris Seaman, Business Broker: Southern California
Founded in 1994, First Choice Business Brokers has accelerated to become one of the most successful Business Sales Organizations in the world. Our team of agents have gone through extensive training to become experts in the field of business brokerage. Call Chris at 858-578-4111 for more info.
|Chuck Post: Laundry Buyer Representation, Consulting, Due Diligence
I have 32 years experience in the laundry industry, specializing in assisting laundry buyers with buying or starting up, building, re-tooling, laundries throughout CA. Laundry buyer representation, consulting, due-diligence, lease negotiations, laundry valuations. Contact me at 619-227-5711 Cell.
|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.
|Rick Carlson, Business Broker - Southern California
You Will Never Feel Lost In The Shuffle. Many Brokers Simply Send Out An NDA And That's The End Of Communication. All Buyers Receive A Personal Meeting With An Ace Acquisition Specialist So They Can Recommend The Perfect Business For You. Phone Rick direct at 800-985-4939.
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