Top Ten Tips when Selling a Business

1. Start planning early – it can take months or years to prepare a business for sale and in doing so, ensuring that full value is obtained.
2. Become better known in your industry – it can be very beneficial to have an active role in your industry association or other sector body. People should know of your business inside and outside the sector.
3. Develop your management team – the sign of a well run company – with less risk to the buyer – is when the owner manager can afford to take time off!
4. Avoid the skeletons in the closet – these must be identified well in advance and either dealt with or communicated to the buyer at the earliest opportunity.
5. Addressing structural issues prior to selling – this is particularly important with family businesses where there are sleeping shareholders. Few acquirers wish to buy less than 100% shareholding.
6. Have accurate timely financial information available – people need to build up trust in you and your business before they will consider it seriously.
7. Develop an alternative to sale – the best negotiating tactic is to have a believable alternative and be prepared to walk away
8. Ensure strong order/sales/profits leading up to the sale – the sure-fire way to give confidence and prevent price reductions at the last minute.
9. Get the right advisors – ensure that they have experience in business sales and can work together.
10. Keep your exit plans secret – uncertainty is the worst motivator and however good your intentions it rarely pays to let the “cat out of the bag”.

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