Good preparation is the first step towards getting maximum returns for the sale of a business.
Before a seller can even get to the point where a broker is putting the business up for sale, they need to make sure that the business is in the best shape possible. And for potential buyers, being in “best shape” means having maximum clarity. It is always best to draw upon good professional accounting and legal advice to have your systems well set up.
A seller who not only knows, but has hard proof of the ongoings of their business is putting their business in its best position for sale.
When financial records, asset registers and staff and customer records have been well kept and are ready for inspection, it makes a business much more attractive.
Much like selling a car, buyer confidence is heightened when records are well kept and the pros and cons are made clear.
Being honest about your business will help you attract a higher percentage of genuine offers.
Businesses have their weaknesses but it doesn’t mean that all is lost. If you’re able to effectively communicate both pros and cons and have strategies in place for further improvement, you’ll immediately reduce buyer uncertainty.
There are a number of things that business managers should keep well-documented. No matter if the business is a small owner operator or a corporation, typically, buyers judge a business based on the evidence of the following:
Industry know-how/ intellectual property
Operational strengths and weaknesses
Promotional materials (particularly an up-to-date mobile responsive website)
Competitive advantage of products and services.
To best prepare a business for sale, put its best foot forward with well documented procedures and thorough record keeping.