The best time to sell is when a business is doing well. However, it is often the case that a business can be sold, even if it is not doing well, if the sale is handled professionally and priced correctly.
Just as is the case with your house, stocks, etc., your business is worth what a buyer is willing to pay for it. The key to a successful transaction and maximizing that value is identifying the right buyer for your business. VR will analyze your financials and take the time to sit with you and learn about your business and its unique attributes. We are experts at valuing businesses and, as members of the VR network, we benefit from access to the most extensive, proprietary database of closed transactions in the world. Having done our homework, we will follow-up with you and provide, on a free, no-obligation basis, our Opinion of Value.
It is best to figure that the entire process from our initial meeting through closing will take 6-12 months, although many transactions close more quickly than that and some close in as little as 2-3 months.
If it is important that the sale be handled confidentially – with regard to employees, competitors, suppliers and/or customers – it is crucial that you allow a highly professional broker/intermediary handle the process. Everyone at VR understands how important maintaining confidentiality is to most sellers. Also, managing a sale process is very time consuming and it requires a lot of mental energy. Many owners will find it extremely difficult to run their business properly and at the same time oversee the sale of the business without help. The main reason some potential transactions fail to close is deteriorating financial performance at the company being sold. In addition, the process is quite complex. Whether your business is likely to be sold to a strategic acquirer or an individual entrepreneur, we know how to approach and customize the valuation, marketing, buyer screening and negotiation aspects of your sale.
Our fee is based on the size of your transaction and is generally paid out of the escrow account, in cash, at closing. We get paid a percentage of the total value of your transaction and that percentage goes down as the value goes up. For example, our fee to sell a business worth $1 million or less is 12% and our fee to sell a $20 million business is 3.5%. If your business is on the smaller side, please be aware that our minimum fee is $15K.
Our office operates on a success-fee based model. We only get paid for successful closings. Selling a business is a time consuming, complex process that demands hard work. It would be unreasonable for us to put all that work in – and for you to benefit from our input and efforts – and not be compensated at your closing. If you are uncomfortable making VR located in Milford, CT your exclusive agent for some reason, then offer us a substantial retainer and we can talk about it. Large or small, no one is going to handle your sale more professionally and diligently than VR.
An independent valuation report improves the likelihood of a successful closing significantly. It demonstrates seriousness of purpose and minimizes price negotiations, allowing you and the buyer to concentrate on other terms of the sale. Also, many lenders demand it – an independent valuation can help your buyer obtain the financing he/she needs to close.