Selling your business can take years to accomplish. There is a lot of preparation that goes into selling a business. Here are some tips for getting your business ready to sell.
Tip #1
Be sure to work out any significant problems well before placing your business on the market. Address any litigation or environmental issues before it is time to sell. Pending litigation or a potentially costly environmental cleanup will scare away prospective buyers.
Tip #2
Determine who has the legal authority to sell the business. Selling a business can become more complex if a board of directors or majority stockholder situation is in place. Dealing with a sole proprietorship or partnership is less complex.
Tip #3
Maintain a flexible mindset. You can’t have everything you want. Both buyers and sellers need to be flexible. One example is real estate. Buyers may not want real estate associated with a given business. Sellers should be prepared for this. Another thing that sellers should prepare for is accepting valuation multiples for lack of management depth, reliance on a small number of customers, and other factors.
Tip #4
Be certain to discuss non-negotiable items upfront. This will save everyone involved a great deal of trouble.
Sellers should partner with experienced professionals such as attorneys and business brokers. You’ve put a lot of energy, time and resources into building your business. EBIT can help you achieve optimal results.
EBIT Associates is a leading intermediary and investment-banking firm advising private and corporate clients on lower middle market transactions. We specialize in lower middle-market mergers and acquisitions and high-end business brokerage. We primarily sell companies with revenues of $1-500 million. Although our process allows us to facilitate larger engagements, we focus on companies with $1-15 million EBITDA.