Preparing to sell a Business

Whether you bought the business or started it there is no doubt that you will have invested a lot of time and effort into running it. The decision to sell your business is often a bittersweet one and the challenge is to find an effective way to reach a sale. Naturally you will aim to achieve the best price in the shortest time possible, in order to do this proper preparation is essential.

When you prepare to sell a business you first need to identify strong reasons why someone else would want to buy it. Try to use a buyer’s perspective and ask yourself if the business is a viable purchase. You should also ask yourself the following:

Is the business healthy?  Trying to sell a business which is struggling is difficult, buyers will usually hang around and wait to get the assets at a knockdown price. If the business is struggling look at how to turn things around, this will demonstrate to potential buyers that it is on the way up and increase salability.

Are the financial records in order?  Buyers will want to see well kept and organised accounts, usually at least three years. These accounts should ideally be prepared by an accountant and should include profit and loss, balance sheets, business activity statements, and tax returns. Buyers generally look for a pattern of steady growth with potential to increase. The more information you put together the more professional you will look and this will make it much easier to sell the business. Read more about how to show strong financial performance.

Are the basics in order?  Make sure that all the basics are in order, make the business as appealing as possible to prospective purchasers. Buyers will want to see a well maintained business with an organised feel.

Are the premises in good decorative order?

Is there a solid team of staff and management? Do all that you can to show that the business is in good shape and that it will make a good acquisition. Try to streamline your business operations When trying to sell a business it will help if you can show a solid structure which does not depend too much on you the owner. If a buyer feels that the business relies too heavily on current owner it will make them nervous about buying. Try to build a team around you which are capable of operating the business without you. By doing this you will increase the salability and possibly increase the value of the business. 

Show strong financial performance
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