In order to ensure that the sale of your business
goes as smoothly as possible, we would like to share with you some of the
do's and don'ts in selling a business that we have learned over the years.
The sale of your business will go much more quickly, smoothly and
successfully if you keep these points in mind.
The following list
is not in order of importance. In any given situation, one or more of them
can be important.
Do be flexible and keep an open mind. The sale
of a business encompasses many factors. Don't take an adamant stand on
any one item. Look at the whole picture. Your best interests are served
by working with us to negotiate a good offer. Frequently, you can "give"
in an area of minor importance, and "get" in an area of major importance
to you.
Don't surprise anyone with undisclosed
problems. There is no such thing as a perfect business. Tell
Acquisitions Unlimited up front about any current or past problems with
your business, i.e. lower than expected sales or profits, loss of a
major customer, lawsuits, having been in Chapter 11, etc. Do not try to
minimize them or pretend they do not exist. This will enable us to
explain them in their best light to a prospective buyer. Almost anything
can be explained satisfactorily to a buyer if they are told about it
early on.
Do continue to operate your business as if it
were not for sale. Since Acquisitions Unlimited only represents good
businesses, we are generally successful in selling most of our client's
businesses. However, while we are marketing your business, it is not the
time to "rest on your oars." You owe it to your employees, your
customers, and most of all to yourself, to continue to purchase needed
equipment and inventory, seek out new customers, etc.
Don't try too hard to impress a prospective
Buyer. Be yourself. Occasionally, owners act as if they have all the
answers and let it be known that they are doing the best possible job of
running their business. This may help our ego, but it does not help the
sale of your business. If you are so good that you are irreplaceable,
your business is probably unsaleable. What buyers would want to try to
follow such a tough act? All buyers want to see potential for them to
grow the business. We don't mean that you should be too humble - you
have a right to be proud of your success. Just don't convince the buyer
that he can't measure up to your standards.
Do be careful what you say to a prospective
Buyer. Feel free to discuss any aspect of the operation of your
business. However, do not discuss the purchase price, down payment,
financial statements, etc. You do not want to negotiate a sale
prematurely. If a buyer asks you about these items, refer him to
Acquisitions Unlimited.
Do minimize your exposure to a prospective
buyer. Once you have accepted an Offer to Purchase, try to minimize
further contact with the buyer until closing. You, or one of your
employees, may inadvertently say or do something that "turns the buyer
off." You have nothing to gain and potentially everything to lose by
being "chummy" with a buyer prior to closing. Remember, a sale is not
completed until it is closed.
Don't tell your employees the business is for
sale. Most business people are, by nature, honest and straightforward
people. Because of this, frequently they mistakenly feel they should
tell their key employees the business is for sale. A key employee may
look for another job, or accept an offer he may otherwise have turned
down if he finds out the business is for sale. You do not want to lose a
valuable employee - and neither does the buyer. After all, he is paying
you a good price for your business because, among other things, you have
key employees in place. The loss of one of these may jeopardize the
sale.
Do beware of "Seller's Remorse." You should
know in advance that there is a good chance that prior to closing you
will wonder if you are doing the right thing. This is perfectly normal.
After all, your business has probably been a major part of your life for
a number of years. Remember your original reason for selling:
retirement, new ventures, etc. It probably took you a lot of soul
searching before you decided to sell.
Do try to close the sale as soon as possible.
Frequently sellers who have had their businesses for many years feel no
sense of urgency about the closing date. They will say something like,
"I've had the business for 20 years, what's another few weeks?" The
longer the period between an accepted Offer to Purchase and the closing,
the more chances there are for things to go wrong.
Do use the services of Acquisitions Unlimited as
much as possible. We have many years of experience negotiating the sale of
businesses, arranging financing, transferring distributor agreements,
renegotiating leases, etc. Take maximum advantage of our experience and
expertise. Your time should be spent in continuing the successful
operation of your business, not in worrying about every little detail of
the transaction.
Most of these comments are just common sense.
Some are a little less obvious. We hope we have not offended you by
bringing up these points. However, the cost of making a mistake in some of
these areas can be hundreds of thousands or even millions of dollars, if
it prevents the sale of your business. Under those circumstances, we feel
that bringing these matters to your attention is warranted. We will be
happy to discuss any of these points with you.
