Selling a Business
In selling your business you should finally be reaping the rewards of your hard work. You might be retiring, or deciding to cash in at the right moment before moving on to the next venture.
Whatever the motive, the sale of your business will be one of the most vital things you'll ever do. If you get it right, the financial rewards can be very significant, but you only get to do it once. Here are some of the most important issues you will have to take into account:
1. The right time to sell
When is the best moment to sell a business? Ideally, you would sell when your marketplace is booming and before any anticipated downturn or saturation. But internal factors are equally vital. If your business is going well and at the peak of a pricing cycle, it will be more appealing to potential buyers. If at all possible you should sell when you want to, rather than when you have to.
2. Preparing your business for sale
You will need to have up-to-date information available for inspection by potential buyers. This will include business plans and budgets, as well as historic financial data.
There are several things you can do to make the business more appealing to potential buyers and therefore attract the best possible price. These could include:
- Improving your assets - you might want to sell off any unproductive assets, and replace any machinery reaching the end of its useful life.
- Formalising contracts - put into writing any deals you have with suppliers, and contracts with employees
- Smartening up - make an effort to improve the appearance of everything in the business, from the premises to the paperwork.
- Reducing liabilities - if you can clear up any pending legal disputes or other liabilities before the sale, there will potentially be fewer obstacles to put a buyer off
3. Setting the right price
Competition between potential buyers is often the ideal way to set a price, but failing that we can help you to value your business accurately. Remember that overvaluing the business could discourage buyers.
4. The sale process
The process of finalising the sale, and determining the form and timing of the sale consideration, can be very difficult. We can help you through it.
There may be valuable tax reliefs available here, so talk to us early in your planning to avoid a needless tax bill.
With the right advice and planning you will maximise the chances of getting the price and terms that meet your reasons for selling your business. Our Wirral team has real expertise in helping businesses-owners to value and sell their business. Contact us for more information.