You’ve built a small business and have decided to sell. This process is one of the most difficult to handle and complete; the emotional weight of selling your small business is enough to strand many owners. If you are considering this transition or already in the process, consult the following 10 tips for additional guidance.
- Define your post-transition business. Will you, personally, stay with the business? Will you leave? Are you retiring? It is normal for every business owner to feel stuck or stranded after a sale, making realistic post-transition goals absolutely essential. If you are having a difficult time deciding your plan, consult a small business network.
- Obtain necessary financial information. Complete data, including payroll, profits, and tax information, should be available for the previous three-to-five years before a sale. This information will allow your business to, potentially, sell at a better price. It will also increase the chances of sale.
- Define your transition goals. Understand your priorities and the ways in which these goals will influence subsequent plans. To that end, it is always helpful to define objectives and timeframes prior to entering a sale.
- Develop your transition plan. Specialized advisors can help you define objectives, but it is necessary to clearly articulate your plan to buyers prior to the sale. Present this plan to potential or verified buyers for their consideration.
- Articulate the type of buyer you want. This is essential to ensure the longevity and original mission of your business. In some cases, large corporations may purchase small businesses in order to liquidate the assets. If this is not something you want to consider, clearly define the parameters of the sale prior to the agreement.