When contemplating the sale of your business, it is important to understand who you should work with and why. In order to make informed decisions, there are several key players involved.
Whether you have been approached by a potential buyer or are thinking of selling your business, here is a detailed list of some of the key people you may need to talk to when considering the sale of your business:
- M&A Advisor: A mergers & acquisitions (M&A) professional will help you navigate all aspects of selling your business, from valuation and preparation of a Management Presentation to engaging with buyer(s) and closing your transaction. An M&A advisor will assist in evaluating each potential buyer, analyzing offers, and negotiating terms on your behalf. They also provide guidance on legal documents such as contracts, due diligence, and closing and post-transaction transition planning.
- Attorney: A lawyer with specialized knowledge regarding specific rules governing M&A sale transactions is important when engaging in any discussions about transferring ownership rights for a company. An attorney familiar with corporate law in your state and experienced in business sale transactions of your size and in your industry will be able to handle all the legal documentation related to the sale including non-disclosure agreements (NDAs), asset transfer documents and more. 3. Accountant: It’s important to have an accountant review financial records prior to any sale discussion to ensure accuracy and completeness and that all tax and compliance documents have been properly filed. They will also be instrumental in advising on the tax implications of transaction structure for your proposed business sale transaction.
- Insurance Broker: Reviewing your current insurance coverage with your broker is valuable and important. They should summarize what liabilities your current policies cover. An insurance broker can also advise if special policies are needed to extend your coverage for a period of time after you sell your business.
- Banker: Banking professionals are experts at helping companies transition during mergers or acquisitions by providing financing options suitable for both buyers and sellers alike if needed throughout this process. Your banker can discuss terms for paying off or closing existing loans or lines of credit.
Expert Advice – What to Consider Before the Sale
The process of selling a business is not an easy one and can take considerable time and effort. However, with the right preparation, it can be made much smoother. Here are a few key steps to undertake before putting a business up for sale:
Ask the experts
Firstly, get professional advice. It is wise to seek valuation, legal and tax advice when entering this process as they will be able to assess all relevant issues involved. They may also provide useful guidance on how to structure the sale in the best way possible.
Set strategies for every outcome
Secondly, establish what your desired outcome is from the sale. It’s important to have clear objectives in mind so that you know exactly what you want out of the deal before discussing a sale with buyers. This could include factors such as the payment structure, timeline of the sale, and any other terms you may want to include.
Get your affairs in order
Thirdly, ensure all your documents and financials are up-to-date and accurate. When preparing to sell a business, it’s important to have proof that the business is running as smoothly and as profitably as possible. Potential buyers will want to see detailed financial data for at least three years prior so make sure these are accurate and available.
Prepare for the transition
Finally, review existing contracts with customers or suppliers and plan ahead for any inevitable changes in ownership which may arise from a sale. This should help to minimize disruption during the transition process after the sale has been completed.
Expert Advice – Defining Your Goals and Financial Needs
Before you share any information with potential acquirers that approach you or embark on the journey of selling your business, it is essential that you take the time to think through and define your goals and financial needs.
Do you plan to move on to another venture or pursue other interests? Are there legal considerations related to ongoing contracts that need to be addressed? Defining these objectives upfront will provide clarity and focus throughout the process.
Are you ready for the sale? Destined is your go-to industry expert for your business sale transaction.