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The Process

 

Before you jump into selling your business, we want to make sure you understand the process and to be prudent in managing expectations.  There are so many subtleties in marketing and selling your business that we have broken it down into three Phases.  

Phase 1. Valuation & Strategy

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As a business owner you know every aspect of how to run your business, but when it comes time to think about selling - where to begin? The first questions is often, "What is my business worth"?  Since every party to a transaction looks at value differently, each uses a proven method of valuing your business.  You, the seller one way, the buyer another way and the bank another.  Determining business value is an art, not a science and can be very subjective.  We help you arrive at a value that is defensible to all parties. Once we set our asking price, we then we go about determining who that buyer might be.  A strategic buyer - one who might bolt on your business onto what they are already doing. Or a financial buyer - one who is buying your business strictly for income and other financial benefits. Together we talk about who your buyer might be.  If you are ready to take this first step we offer an "opinion of value to arrive at a defensible valuation.  This will arm you with valuable information in which to help make future decisions.  All while maintaining confidentiality!    

Phase 2. Marketing & Qualifying
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Marketing a business opportunity is much more sensitive than trying to sell real estate of other capital assets. Most business owners want to be discreet - and for good reason! No need for the employees, customers or vendors to know you are planning to sell.  At least not at this stage of the process. Our potential buyers come from several resources.  Many leads come from internet advertising, some from business referrals and some from our in-house stable of buyers who have responded to other business opportunities. These are not just names and phone numbers.  These candidates have completed a non-disclosure agreement, a buyer profile which establishes what geographic area and industry they want to be in as well as what kind of experience they have and  what type and amount of initial investment they are ready to make.  If they don't meet this minimum qualifying criteria we don't get them in front of you, the seller.  Experience in the industry is key to most successful acquisitions.  You keep operating your business as we go through the Phase 2 process of finding a qualified buyer. 

Phase 3. Negotiation & Escrow

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This is truly where years of experience pays off.  With business value being subjective often times the transaction is as much or more about the terms of the offer as it is the price.  We incorporate all aspects of the offer into the negotiation.  Any one of these details can make or break the final outcome.  Things like consulting agreements, closing dates, owner financing, earnest money, due diligence period, bank financing, working capital and asset allocation are all part of the negotiation. Our job is to improve the odds of getting a qualified buyer and a qualified business to the finish line - the closing table.  We insist on legal and tax counsel for all parties and highly recommend a third party Escrow Attorney to close our transactions. This assures us that all the legal aspects of a transaction are handled in a professional manner and the proper documents are prepared, recorded when needed and costs are itemized for filing future tax returns etc. This legal process benefits both parties and these fees are typically split between the buyer and the seller.   

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