Preparing to Sell Your Business
Selling your business is a complex undertaking.
It starts with planning.
VR can provide you with crucial preparatory assistance prior to going to market.
There are a number of issues and up-front actions that will significantly affect the success of your transaction.
The most important are:
Income and Expenses: Orderly financial books and records to prove and verify gross revenue, cost of sales/products, expenses and net income are vital. The more easily an owner can show a prospective buyer how revenue, expenses and income streams evolve, the easier it is to assuage buyer concerns about cash flow and earnings.
Reasonable Pricing: Usually, buyers won’t even look at a business that is not priced competitively.
Image: Does your facility and operation, in general, manifest a positive, professional and clean image?
Obtain a Professional Third-Party Evaluation: In most circumstances we highly recommend this. Independent valuation reports improve the likelihood of a successful closing and often reduce price negotiations. Neither VR nor your accountant will be viewed by potential buyers as objective in this regard. We work with a number of excellent firms that provide independent valuations.
Furniture, Fixtures and Equipment (F, F, & E) List: Providing a complete list of the F, F, & E that can be referenced during inspection is an important part of the process.
Lease Considerations: Knowing the terms of a lease including the requirements of the assignment or the terms offered on a new lease.
Reason for Sale: Buyers are always concerned about this. They are afraid you may be selling because of some undisclosed fact that may hurt the business in the future. Buyers must see a logical reason for the sale or – without it, they think the worst.
NO SURPRISES: It is very important to be candid about all aspects of your business up-front negatives can generally be overcome if we are aware of them from the beginning.
Keep-in-mind that anything that increases sales also increases profits and the all-important cash flow!
Make it easy on the buyer to make a positive decision by making certain your business shows like a winner.