When it comes to selling your business, it can be overwhelming and quite a stressful time. If you’re considering selling your business or would like to know more about the procedure for further down the line, we’ve put together a stress free guide for beginners to make the selling process as simple as possible.
Be prepared and do your research
Selling a business can be time consuming so even if you’re not looking to sell your business right now, you should always be prepared. The first thing you need to do is change your mind set into that of a potential buyer. Identify your business USP that will make your business more attractive and do some market research to gain industry intelligence. It’s worth noting that there are M&A specialists like BCMS who can help locate and negotiate with investors across the world.
There are 5 key points that acquirers and investors are going to focus on.
- Company finances. A potential buyer will be looking for healthy sales, turnover and profit so they will do a thorough examination of your company’s financial statements.
- Potential for growth. Potential for future growth is just as important as having healthy finances.
- Strong customer base. A customer base that is strong, diverse and committed is appealing as it gives the business a solid basis for future plans.
- Transparent business options. Sellers need to provide comprehensive and accurate documentation regarding everything from insurance policies, and tax and employment contracts as any transgressions could have a big impact on the buyer’s finances and reputation.
- Effective management structures. An organisation that can survive and flourish without the founder is more attractive to buyers, so it’s vital to have effective management structures in place.
What makes your business stand out?
If you want a potential buyer to seriously consider acquiring your business, you will need to identify your business USP; the things that make your business stand out from competitors. Consider producing a detailed financial forecast outlining three years of profit planning. It will bring value-added benefits to purchasers if your outlook is strong. Having good, reliable relationships with suppliers is vital to any business as it allows you to access better service and deals. Attracting new customers is important to any business but loyal customers are a crucial part to the long term success of a business.
Find the right buyer
It’s important that you feel comfortable with a potential buyer. There may be many reasons why they want to acquire your business but as a seller you should analyse the profile of any potential buyer to ensure all deal options have been considered carefully. It is beneficial to any business owner to have a certain level of trust with an acquirer and to have built up a positive personal rapport with them. Ensure you have an experienced corporate lawyer when selling your business.
If you’re still looking to sell your business, consider the above tips to ensure you get the best deal possible. If you have any insights that you would like to share on this subject, join in the conversation using the hashtag #SellingYourUSP.