You’ve Decided to Sell Your Business…Now What?

There are many reasons why you could decide to sell your business. It could be that you are looking to end partnership disputes, retiring, or just cashing out to work on another idea you have. Regardless of the particular reason, you will definitely be looking to get as much for the business as you can while avoiding any legal pitfalls. Here is a checklist of five steps that will help you achieve that:

  1. Valuation – The value of your business in the eyes of a potential buyer is not always consistent with your own. It is affected by different factors including the value of your assets and the perception of present and future profitability. It is very important that you hire a competent service to conduct a third-party valuation of your company. This enables you to develop a realistic price-range with which to consider any offers you receive, as well as identifying things you could work on to improve the company’s value prior to closing the sale.
  1. Hire a business attorney – As you proceed through all the stages of selling your business, you will definitely need timely and accurate legal advice. Your attorney will be able to inform you on your position in relation to the law when certain issues arise. It will also be very helpful to have a professional guide you on what your best course of action is. You should seek to hire an experienced attorney whose expertise is in business law.
  1. Prepare your company – An organized and transparent company would be very attractive to a potential buyer. Work with accounting and tax professionals to make sure that your books are in order, and that there are no anomalies that could raise red flags when buyers are conducting their due diligence. You should also try to increase the attractiveness of your company by diversifying your client base and increasing sales. This might take some time and effort to do, but it will mean you have a stronger position from which to bargain from.
  1. Finding a buyer – This is very dependent on the status of your business and circumstances surrounding the sale. You could advertise in business magazines and other targeted media. Alternatively, you could be more subtle and reach out to possible buyers directly. One other option is to engage the services of a broker who will work with their network and do the marketing necessary to find buyers. Their payment is usually in the form of a percentage of the sale amount.
  1. Negotiation – At this stage, you will have to work out the specific terms of the sale. You should be ready to make a few compromises, but ensure that you remain firm and do not deviate too much from the valuation you got at the beginning of the process. Make sure there is full disclosure and that everything goes into writing.

If you are considering selling your business, please contact APH Law PLLC to discuss how we can help you through the process to get the best possible results.

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Written by APH Law PLLC

APH Law PLLC

When we founded APH Law PLLC in 2010, we did so out of a desire to connect business owners with more and better opportunities. No matter what industry you’re operating in, creating a strong foundation, preparing for the future, and protecting against challenges are key to long-term success. It is this kind of support that we take tremendous pride in helping businesses.