If you’ve ever bought and sold stock, you might assume a similar market is available for privately-held businesses. But selling an entire company is a much more complicated process than selling shares; there’s no all-inclusive market showing all the available listings for sale, and it can be very difficult to determine if you’re coming out ahead.
We’ve created a comprehensive document explaining every step of the selling process, but you can expect that establishing the proper price for your business alone will be an enormous challenge. To begin with, most business accounting is done to minimize tax obligations, deliberately downplaying the value of the business – not, as you might imagine, the best premise for establishing a high value on the seller’s business.
One final challenge, just to drive the point home: your business will have a much higher chance of selling at a good price if it is currently operating at the top of its game. If you’re the one trying to navigate the sea of lease negotiation and Small Business Administration (SBA) loans, you’re likely not going to be putting your focus on maximizing your business’ operations. The more effort you put into the selling process, the less effort you’re putting into making your business look appealing to a buyer – and vice versa.
We suggest splitting up the responsibility. You do what you do best: run your business for maximum profits. In return, we’ll do what we do best: attract a highly qualified buyer to offer you an incredible price for your business.
What we can do for you (that you can’t do solo)
Working on your own, you’d have to wade through dozens of tire-kickers before finding a buyer you can take seriously. We screen all your potential buyers to determine their financial qualifications and their work background. We only bring you buyers who are genuinely interested in your business and financially capable of buying it.
One of the biggest frustrations for the solo seller is that most people who call about one business end up buying another one entirely. This happens because they learn more about your business and decide that this other one will have fewer complications or a better return. There’s little rhyme or reason to it, since each buyer considers different aspects of the business to be ‘too difficult.’
Working alone, your business simply gets rejected as the buyer looks for more appealing prospects – working with us, your business becomes the more appealing prospect to a buyer who has decided another business isn’t quite to his taste.
We sell and list so many businesses in Northern California that we’re able to match up the right buyer with the right type of business quickly and efficiently. We have a proprietary database of pre-screened, qualified buyers so you never have to deal with a prospect who isn’t really serious about or capable of buying your business.
We are also able to market and advertise your business more efficiently with our established network – some professional journals have as much as a 2-month lead time just to place an ad!
Finally, we can make sure your confidentiality is protected throughout the selling process with our ironclad non-disclosure agreement (NDA). We protect your privacy and your income-producing asset so that it maintains its value throughout the selling process.
Get in touch today for a consult, and together we’ll talk about your goals. There’s no risk, no obligation – just a comfortable conversation that leaves you feeling confident.Contact us here
We can help sell your business in the State of California and the Sacramento area including Sacramento County, Solano County, Yolo County, Sutter County, Placer County, El Dorado County, Amador County, San Joaquin, Contra Costa County, California Central Valley and San Francisco Bay Area.
You’re ready to sell your business, but you’re not quite sure where to begin. This guide is designed to help you with that.
Step 1: Have a Plan
To start, you’ll need to create a plan for selling. You’ll determine how much you’d like the business to sell for and conduct a full valuation to see if your business can reasonably command that price. You’ll need to gather all your business’ data, including tax statements, business plans, strategies and training, and everything else that can be considered in the assets.
If that valuation concludes you can’t get the price you were hoping for if you sell now, your plan will include steps to increase the value of your business before you put it up for sale.
You’ll need to recast your financial statements, since your tax documents are usually prepared with an eye to showing the lowest profits possible. That’s great for taxes, but the worst possible strategy when you’re trying to convince a buyer that your business is worth buying. All your company’s finances will need to be presented in a light that makes them appealing to buyers.
Finally, you’ll prepare an Executive Summary of your business and a Confidential Business Review. Only then are you prepared to seek out potential buyers.
Step 2: Do a Search
If you don’t have a plan for finding qualified buyers, now’s the time to invent one. You’ll need to track down buyers who are interested in your type of business, preferably ones who are likely to have the financial means to invest. You’ll distribute your Executive Summary to those buyers – so it needs to be very compelling, since it’s the bait you’re dangling to hook your big fish.
Once a buyer bites, you’ll need to qualify the buyer to be sure he can afford your business. You’ll also agree to send him your company’s Confidential Business Review after the buyer signs an NDA or Confidentiality Agreement. Make sure yours is iron-clad – or all your business’ secrets could disappear.
You’ll need to determine how interested the buyer really is, which can be difficult, since they often lie about their level of interest while simultaneously entertaining other offers. If you do get a buyer who’s definitely willing to move forward, though, it’s time to make a deal.
Step 3: Make a Deal
You’ll conduct an initial meeting with your buyer and give them a tour of your business. Once again, you’re going to need to gauge how interested the buyer really is, particularly if you have other offers. If you reject a second buyer because you think this one will pay a higher price, you could lose out when the first buyer bails at the last minute.
If you’re confident, you’ll motivate the buyer to act by giving a firm purchase offer. You’ll then negotiate a price and, if successful, you’ll write up an LOI or Asset Purchase Agreement to seal the deal.
Step 4: Close the Deal
Once more, you’ll need to open due diligence. Your buyer will need to apply for financing if they need it and obtain lender instructions. You’ll open Escrow, start the Bulk Sale process, and – if all the paperwork is filed properly, every i is dotted and every t is crossed, you’ll finally sign the final documents.
It’s a Complicated Process
You’ve probably already identified a few points where you need clarification or where you’re certain you’ll need assistance. That’s what we’re for. We’ve conducted hundreds of successful sales and purchases, and we know how to make the whole process run smoothly.
What’s more, as you can see, conducting all these steps is a full-time job. By hiring us, you’ll be able to focus on keeping your business running at the top of its game – which will ultimately allow you to command a higher purchase price for your business.
We personally recommend you turn the many steps above into one simple one: get a qualified business broker to take care of all the complicated stuff for you. Contact us today; we’d be happy to help.