Sales Process Step 2: Prepare The Business For Sale
This is the first step in the sales process. During this stage we typically conduct a client interview, determine your objectives and obtain pertinent information. We assemble financial and general information on all aspects of your business.
Proper preparation is necessary for the best presentation of your business and is required in order to provide meaningful insight to prospective purchasers. While preparing the business for sale we will engage in Asset Analysis and Structuring, where we review and analyze the assets you hold within your business and may suggest legal structures you might consider using to better protect those assets and possibly enhance their value. In fact, you may even be unaware that you hold many of these assets. The appropriate structuring and accounting for those assets is likely to greatly enhance the value of your business.
Value Proposition Strategy
The business must be properly packaged with all applicable records and facts organized and documented in the most strategic way to maximize potential value. This ensures a presentation of our client's business in the best light, while providing the purchaser with a solid audit trail to corroborate the seller's representations of value.
We will provide you with an exhaustive checklist of items, that if applicable, should be assembled into a book, appropriately bound (either in a 3-ring binder or comb-binded) and tabbed for easy reference. Use the check-list to create a table of contents for the book.
This presentation educates the buyer on the many intangibles inherent in your business, hence raising the perceived value to the acquirer and communicates to the buyer that the business is well organized and easily transferable. These intangibles include among others, name recognition, market niche, vendor relationships, operation and production systems, distribution channels, customer loyalty and trained and skilled employees.
Thus, the book which you create from the checklist provided above, enables us to create and provide the prospective buyer with a business profile and thereafter, a more detailed sales offering memorandum assembled to present the business as a unique market opportunity with huge potential for growth and expansion thereby streamlining the process of selling your business.
Key Points To Consider:
- Disclose all relevant information – even negative facts. A buyer wants to be able to trust you. Any indication that you're not truthful or that you failed to disclose all pertinent information can put off an otherwise interested buyer. Realize that during the due diligence stage of the purchase a savvy buyer will likely investigate all aspects of your business and discover negative facts anyway.
- Ensure that the business premises are well organized and in good shape. First impressions are very important. At some point, an interested buyer will want to visit the business location and it is important to ensure that you create a good impression. How you maintain the business premises will go a long way toward communicating that the business itself is well organized and running efficiently. Therefore, apply a fresh coat of paint, make minor repairs (especially if the repairs are the responsibility of the landlord) and organize and clean the premises.
