Whatever your reason for selling your business, you’ll certainly be aiming to sell for the best price in as short a time frame as possible. In fact one of the most asked questions we are asked when people are looking to sell is ‘how long will it take to sell my business?’
Bizdaq offers a really efficient search-to-sale cycle, with sellers moving from initial enquiry through to deal completion in an average of just five to eight months – which is pretty fast work!
It’s certainly significantly less time that you’d expect if you went the traditional route of commissioning a business agent, largely because communications between buyer and seller are quicker without the agency ‘buffer’ in the middle. Obviously, the speed of your sale will largely depend on how ready you are to proceed; if the process gets snagged at your end because you haven’t got your house in order, you could be looking at a much lengthier transfer window!
So give yourself the best chance of success by making sure you prepare for action from the get-go with my tips below:
Priorities include getting your paperwork straight so buyers can see the profitability – and the potential for growth. It will take commitment but a quick sale will more than repay your investment in time. Apart from satisfying them that your tax records, leases, contracts and articles of incorporation are in fine fettle, it also reflects well on the efficiency of your business operations.
You’ll need to consider exactly what you’re selling – the company brand or the whole operation, lock, stock and barrel. Each has its own challenges so make sure you’re prepared by instructing a solicitor who’s experienced in business transfer to draft and negotiate the sales agreement. You might also need help formalising contractual relationships with customers, suppliers or even key employees in anticipation of a sale. You should take advice on how to minimise your tax liabilities when the deal goes through.
This is the tricky part. If you’re tempted to ask too much, you could be risking a prolonged sale period with the possibility of a price reduction and a ‘stale’ listing, but settle for too low a figure and you could lose out financially. Thankfully the Bizdaq valuation tool will take the guesswork out of pricing your business. Its algorithm calculates values based on actual sales data for your type of business and takes into account a range of factors including location, turnover and potential for growth.
When negotiations begin, the real pressure starts. You’ll end up agreeing terms and price by agreement with the seller so make sure you know what your bottom line is but don’t let the sale stall on a minor issue. Check out how your buyer intends to fund the purchase. If you’re prepared to be flexible about financing – perhaps offering part-finance or staggered payment terms – you could get a better price.