 | Steve Fischer is the president of Advantage Business Group in Wichita, an owner in the VR Business Brokers network of offices. With national and global reach, VR is one of the nation’s premier networks of professional business intermediaries. A life-long Kansan and previous business owner, Steve’s office exemplifies the service and professionalism that a business brokerage provides to the buyer and seller in today’s market. To learn more, visit www.VRplains.com or www.VRBB.com. Steve can be reached by phone at 316-262-8722. |
Business
1969-12-31 18:00:00
Getting my business ready to sell
Answer: Every privately held business will change owners or close at some point in the life cycle of their business. Good organization and a little effort beforehand can make the process much easier when the time comes. Here are some of the specifics needed in order to aid a successful transfer of ownership:
•Provable books and records. The person who buys your business wants proof of past sales, expenses and profits of your business. You need to keep detailed records. If you can’t prove it – it didn’t happen.
•Reasonable price and terms. The person who buys your business must be able to live on the profits or get the desired return on their investment.
•Documentation of assets being sold. You need to prepare a complete list of assets, furniture, fixtures and equipment being sold along with realistic values for each.
•An attractive lease. Your lease is a significant part of your business. It is of the utmost importance that the groundwork be laid for either a new lease or the transfer of the existing lease.
•Best possible appearance. Appearances do matter, you need to have the premises neat, clean and in good repair.
•Value the business properly. A professional business broker can offer evaluations and opinions of value based on the past history and comparisons, not only to industry standards and models but also comparable sales. This service or a formal valuation shows the buyer the business is competitively priced.
•Covenant not to compete. No one wants to buy a business only to compete with the seller. You need to have a new plan in place after the sale.
•Reason for sale. Buyers want to understand the reason for the sale and need to be comfortable that there is not undisclosed information that could negatively affect the future.
•Time is of the essence. Keep your records updated and be prepared to move forward when a qualified buyer shows interest.
•No surprises! Everyone hates surprises and many adverse situations such as landlord problems, outstanding loans, judgments, tax arrears, liens, unfavorable equipment leases and even non-compliance with zoning, health or other regulations can be overcome if known up front. Be sure to share this with your broker.
Whether or not you sell your business, having control of the above items is simply good business sense. At some time there will be a transfer of ownership. By addressing these issues in advance, the process will be much more manageable for you or your heirs.
