Have Answers Ready When It’s Time to Sell

0



Mike Dunkel, a broker for Sunbelt Business Brokers of Southern California, said that deciding to sell a small business is the first step in a complex process.


“The first thing any buyer wants to know is why the seller wants to trade his company. He may not be doing well and may want to get out of it. He may be a 50-year-old but ready to sell his business and retire. Or he could just be selling it to raise money to move to another venture. Whatever it is, buyers are always interested in the reason.


“Anyone interested in buying a small business will want to know about its financial performance. Normally they look for tax returns for the last three years, law statements and year-to-date statement.


“The selling party should develop a mindset to keep working like they are not selling. If you let the possibility of a sale take the focus off what has to be done, then business will slide a little and potential buyers will definitely notice that.


“A marketing package has to be formulated to provide to prospective buyers. This should include a realistic selling price. Depending on what the business is, it may be attractive to another business that wants to buy this business and fold it into their existing one. Or it could interest an individual who is just looking for a business opportunity with a track record. The marketing package should be attractive one way or the other.


“Once a potential buyer is sighted, it is necessary to establish good rapport between the seller and the buyer. The seller has to make sure that the buyer is capable of handling the business.


“Later, the buyer makes an offer with conditions like verifying financial performance of the company. The seller also sets conditions to verify the qualifications of the buyer. Once these conditions are taken care of, an escrow company should be employed to take care of the closing documents and to properly record the sale.”



*Case Study is a feature in which experts offer advice on the various challenges that small-business owners often encounter. If you face an issue or challenge you think applies to others as well, please contact the Business Journal at

[email protected]

.

No posts to display