17 Aug HOW TO SELL YOUR SMALL BUSINESS SUCCESSFULLY
The sale of your business is one of the most important decisions you will make in your life so getting it right and achieving a successful outcome is critical. Here are some steps to follow to successfully sell your business in today’s market.
- Get a qualified business valuation
Valuing your business accurately is essential if you don’t want to risk losing money by setting the wrong price. Business owners who seek to save money by not getting a business valuation done risk setting a sale price that is emotionally driven and that is either too high and turns off many potential buyers, or a price that’s unnecessarily low and keeps you from cashing out at full value.
- Determine the current worth of the business
Once a business valuation is completely you can assess the gap that exists between what the business is worth and young sale price expectations and whether to proceed with business sale listing.
- Develop a business improvement strategy
The valuation will provide a base line value for the business and allow the owner to work with a business advisor to develop a strategy to improve the profitability of the business and increase the value of the business for sale.
- Get your paperwork in order
Ensue all record keeping is up to date and current financial statement prepared and available to process and make sure all tax lodgements and deadlines are up to date. A business that doesn’t have up to date financials available will be less attractive to prospects and result in delays in sale.
- Show future & growth plans
Businesses that can present business & sales plan to show future and opportunities for growth will attract more quality buyers.
- Produce forecasts
Business that have well designed cashflow and financial forecast with supporting comments will provide assurance and reduce risk for buyers and can add $$$$ to your sale price.
- Document your business systems
Have a full and detailed procedures manual covering all aspects of the business, with documented systems for sales, operations, employment, health and safety.
- HR management
Make sure your employment contracts are up to date and get all staff entitlements up to date. You don’t want any horrible surprises if you discover a staff member is owed a substantial amount of holiday pay.
- Finalise any legal issues
Resolve any legal issues that may be current or pending. Buyers get very nervous if they discover any legal matters are unresolved.
- Customer and supplier contracts are current
Having long term customer contracts inn place with provide the buyer with confidence in your business and provide some security in terms of future income. Also, if a certain supplier is critical to the business operations having current secure supplier contact will reduce operational risk for buyers.
- Check you Lease
Ensure your premises lease is up to date with options signed and in place and that the premises lease can be assigned to the new buyer without any complications – ask a lawyer if you are unsure.
- Tax on sale
Ensure that you identify the tax implications of sale and speak with your accountant the way to structure the sale to minimise your tax.
- Do your research before selecting a broker
Do your research, many sellers that I have come across choose unprofessional brokers to sell their business which results in delays and lost revenue due to a poor sales process, lack of qualified buyers and a very limited due diligence process. Performance Business Sales located in Perth is a premium brokerage firm that delivers quality buyers, follow a qualified due diligence process and a team of experienced brokers which are driven to deliver results for sellers. Don’t take short cuts in this process as selecting the wrong broker can cost your $$$ of dollars, months of delays and lack of business confidentiality which can cause you serious business harm.
Finally make this process stress free and enjoy life after business.