Eight crucial steps to take for those who say "I want to sell my business"

Sellers may think ‘I want to sell my business now’ without adequately preparing. Hard work is required on the accounts, premises and staff.

An organised seller who understands the market can create the best possible impression. Follow these tips to generate suitable interest from the right buyers in your business for sale:

1. Check your accounts. Make sure that your financial documents are accurate and current. Buyers are attracted to the potential of a business and may want to buy your company as the perfect acquisition, even without 100% positive accounts.

2. Self-finance. Many buyers now hope that the seller will help them buy the business. Ask yourself ‘Could I finance the sale of my business?’ Owners who want to include employees in a sale should be aware that if they can’t self-finance the number of interested buyers shall be greatly reduced.

3. Don’t go it alone. Sellers willing to go through the selling process without professional assistance could give potential buyers an advantage from the outset, particularly if the buyers are using buying agents.

4. Resolve problems first. Any outstanding problems with the business should be rectified before entering the selling process. Tying up any issues is essential, rather than allowing buyers to carry out due diligence and find that issues are still outstanding.

5. Get valued. Hire a valuation expert to value your business prior to advertising it for sale. An under or overvalued business may impact upon negotiations with potential buyers. It is difficult to raise the price once you have advertised for a lower amount.

6. Confidentiality. Nether employees, customers nor suppliers need to know that you have advertised your business for sale. Minimise fuss by keeping the sale of your business private.

7. Choose the right time to sell. If your business’ performance isn’t favourable, sellers should wait until results improve. Small companies should wait until the general economic climate improves if at all possible, to maximise returns.

8. Be realistic. Ensure that your expectations about price are realistic. Inflated business valuations can occur quite easily when a seller spends time and effort building up a successful and cherished business before advertising it for sale.  

By using industry valuation techniques you can find the best price for your business.

Read Thinking "how do I sell my business?" Here's how...