Selling a Business 101: How to Get Started
There are many reasons you may choose to sell your business. However, regardless of your reasons, you might not know how to get started when you decide it’s time to sell your business.
Don’t worry if that’s the case. While there are several ways to go about selling a business, the following general tips will help you begin the process:
Prepare for the Future
As an owner, you currently play an extremely vital role within your business. Your absence could result in the business failing if you don’t prepare accordingly.
Make sure you’ve established a plan that will allow your business to continue thriving after another team has taken over. True, the buyer of your business may have their own plan, but generally, you’ll have a better chance of finding a buyer if you can show that your business won’t suddenly begin to fail once you’ve stepped away from it.
Communicate Your Goals
You may not be the only member of your business with a significant stake in the sale. There are likely other relatively high-level team members who deserve to know about your plans to sell.
Be sure to explain your plans clearly and thoroughly. This will give other critical team members more time to prepare, if necessary.
However, many experts feel it’s not necessarily wise to tell all employees about your plans until after the sale has been finalized. If you share your plans with the entire workforce prematurely, employees may assume their roles are in jeopardy. They might begin taking jobs elsewhere en masse, leaving your business unable to serve its clients properly. This, in turn, can make it difficult to find a buyer.
Gather Financial Documents
It’s highly unlikely that anyone will purchase your business simply because they like the core idea behind it. Buyers want to be confident a business has the potential to consistently succeed.
Thus, you need to prepare by gathering financial documents indicating your business has grown steadily since its creation. Additionally, if you have any strong documentation showing your business has the potential to continue growing, gather that as well.
Consider Using a Broker
Finding a buyer for your business doesn’t need to be as difficult as you might assume. Consider working with a broker once you’re prepared to sell.
There are many benefits to working with a broker instead of attempting to sell a business yourself. Yes, a broker will help you more easily find a buyer. Perhaps more importantly, the right broker will have a vetting process to ensure you sell your business to a buyer qualified to keep it running after the sale.
Brokers also help you maintain a necessary degree of confidentiality. Remember, ideally, you shouldn’t share your plans with too many employees until the sale has gone through.
Keeping your plans secret can be virtually impossible if you attempt to sell a business yourself. To find a buyer, you’ll likely have to publicize your plans.
That’s not the case when you work with a broker. They’ll serve as a go-between, helping you find buyers without publicly announcing that you’re selling your business.
The main point to keep in mind is that selling a business may seem intimidating, but it doesn’t have to be. While the specific steps you take may depend on your current circumstances and the overall nature of your business, these basic tips will definitely simplify the process.
