for a Sale
After careful thought, and probably
a few sleepless nights, you and your partners have determined that it is
time to sell the business. The preliminary valuation work pointed to an
acceptable range of estimated market values and hopefully, you have engaged
in the professional services of a financial advisor to spearhead the effort.
For many, this is a once-in-a-lifetime event. As with most such events,
the process is likely to be unfamiliar and perhaps a little uncomfortable.
But, you didn't get this far by avoiding the unknown. Now that you have
a good idea about why you want to sell the business, the question is: "How?"
IN A NUTSHELL
A typical sale process can be
broken down into the three broad phases:
1. Preparing for a sale.
2. Marketing the company, and
3. Negotiating/closing a transaction.
Though it sounds simple, here's some advice: Each phase is an important
step toward giving you the strongest position at the bargaining table. Resist
the strong urge to jump right to the marketing phase, and you'll reap the
PREPARE TO SUCCEED
It has often been said that successful
business people begin to prepare their companies for sale the first day
their businesses are established. While this may not be meant to be taken
literally, it does highlight a key point: Most characteristics that enhance
your company 's market ability take time to develop. It takes more than
a little touch-up or a coat of paint to sell your business at a price you
feel its worth. The presence of several of the following characteristics
will significantly enhance your company's marketability to a credible acquirer
and make it more likely that you will obtain a strong offer:
* Depth of management
* Clear top management succession,
* History of audited financial statements,
* Consistent reinvestment of earnings into operations, and
* Discipline of regular business plans/projections.