Sell Your Business: Steps To Help You Through The Process
Selling your business is one of the most critical decisions that you will make about your company. If you’re thinking about selling your business in the coming decade, remembering every task you have to complete can be a little confusing. That’s why we’ve compiled a list of all the steps you’ll need to sell your business.
1. Assess Your Company
Knowing what your business is worth is the first step to selling it. A professional business valuation can help determine the fair market value of your company and provide a realistic evaluation of its worth. This can help guide you as you develop a marketing strategy for your business and find the best way to sell.
Valuation professionals are with you to help review all sales, inventories, assets, and any debts or loans that may be associated with your business. It not only analyzes your company’s value but also its growth potential by identifying threats and opportunities for future growth.
2. Organize Your Records
Transparency is key to selling your business. Prospective buyers will want to see as much financial data as possible, including business tax returns for the past five years. The more a buyer knows about your company, the better equipped they will be to decide whether it’s right for them.
As you prepare your annual budget, make sure that all income is accounted for. These expenses include more than just your employee pay or investments. They also should include travel and entertainment expenses, vehicle expenses, memberships, subscriptions, and any bonuses given.
3. Hire A Broker
While you can hire a third-party valuation professional, a broker can also complete that job. Also, they often help with preparing a prospectus, listing the business in a suitable marketplace, and obtaining financing if needed. A broker’s expertise is worth the commission so be sure to find one who has specific experience with your type of business.
4. Preparing A Sales Agreement
While some states may differ in standards slightly, the agreement to sell a business is mostly standard in all states. The agreement to sell a business should provide all of the necessary information to facilitate transferring a business. All sales agreements must include all information needed for the sale, leaving nothing unturned.
This information should include the seller’s name and information, the business name and assets associated, as well as necessary terms of payment for the buyer. The assets associated with your business should be laid out to include inventory, debts, and belongings included in the sale.
Other basic information also includes any emergency procedures for common problems, business information and access to confidential information, and any additional fees. Don’t forget to also include the date of closing!
Remember that oral agreements are not typically valid in most states, so make sure your contract includes everything you need it to. Remember also that you can always add to the agreement as necessary, but you must include all of this information at a minimum.
5. Work With Your Lawyer Through The Entire Process
If you are selling your business, there are many considerations. Experienced lawyers like our team at Grand Strand Law Group will guide you through the entire process of selling your business. We can also provide advice on how to best protect your interests.
A lawyer can help you draw up contracts, including purchase agreements, to transfer assets and intellectual property. A purchase agreement helps define the terms of the deal and make representations about your company. Having a lawyer involved prevents misunderstandings that may lead to litigation. If you’re ready to get started, learn more about how Grand Strand Law Group can help.
6. Verify The Information
When you’re negotiating a business contract, the most important thing will be to verify the authenticity of your information. To ensure that this happens, always double-check everything before signing. After all, once it’s signed there is no going back – even if something does not meet your needs or expectations. Also, remember that in many states contracts are construed against the drafter. This means that if you had the contract drawn up, then the other party would have an easier time arguing how it should be interpreted than if they were the ones who drew it up. Don’t let this happen to you!
Sell Your Business With Grand Strand Law Group
The steps to sell your business is an important and complicated undertaking that you should not attempt alone. At Grand Strand Law Group, our corporate attorneys are here to assist with the sale of your business.
We understand that selling your business can be a stressful and elongated venture, and Grand Strand Law Group is here to make the process as smooth as possible. We are here to help you every step of the way. Give us a call at 843.492.5422 and learn about how we can help with your buy and sell agreements.