How To Make It A Success

Selling a business is a complex process that requires many considerations and should be planned well in advance with a professional adviser.

Whether you make any profit from the sale of your business will depend on many factors including the timing of the sale and the profitability of the business. Selling a business requires a lot of your time pre, during and even after the sale. And once sold you may still need tax efficient wealth strategies.  Although it’s not always possible, we strongly suggest working toward the sale of the business years in advance in order to maximise opportunities.

Leenane Templeton can help throughout this process and has experience working with many clients throughout the entire process.

The following general considerations can help you consider what’s involved in a successful sale. For a detailed conversation please call our team on 02 4926 2300.

Why are you selling the business?

The reason for selling your business is the first thing every buyer will want to know. Most business owners may sell their business due to:

• Good Planning
• Retirement
• Boredom
• Death
• Illness
• Burn out

There are those business owners who may think of selling their business when it’s not making any profits. However, this only makes it more difficult to attract buyers. Before you make up your mind to sell your business, focus on your true goals and speak with an advisor.

Prepare for the sale of your business early

Get ready for the sale of your business as early as possible, setting up systems and procedures years before placing it in the market will be a great advantage. This preparation will assist you in putting together the structure of your business, financial records and client base to reap maximum profit from the business. These improvements will make it easier for the buyer and help the business run smoothly.

Value your business

It’s important to establish the real value of your business. A business appraiser can do the valuation for you. The appraiser will come up with a comprehensive explanation of the real value of your business looking at debts, profits, stock etc. Goodwill is also something to be considered and can be difficult to value. This valuation document brings feasibility to the asking price and can act as a measure for the listing price.

Do you need to involve a broker?

Selling a business yourself allows you to save some money that would have been used as the broker’s fees. It’s also the best especially if you are selling to a family member or an employee who is still working with you. However, if you are selling a business to a stranger, then a broker helps by saving you time, making the sale confidential and getting the highest price they can for you.

Prepare the necessary documents

At Leenane Templeton we can help to collect your financial statements and tax returns over the past years and help to provide clear and detailed accounts and reports to ensure the business is in good order for a sale.

You should also come up with a list of equipment that is being sold with the business. Additionally, design a list of contacts that are related to the sale transactions and gather any other necessary paperwork such as your lease. Get copies of the documents and share out to potential buyers who are financially qualified. The information in the documents should include an up to date summary of how the business is run and may include Standard Operating Procedures. It is important that the business looks presentable. Any ugly areas of the business should be spruced up before the sale.

Be flexible about the sale terms

A demanding seller who’s not willing to consider payment terms may find it harder to sell. Don’t be that seller who demands all the cash immediately or one who cannot accept contingent payments. Though the buyer may not agree to your asking price, their offer may still be great.

Selling a business to the right person may be better than selling it at a higher price to the wrong person who will run it down within a few years.