Selling a business process
When you work with Terry Altman, he is your intermediary along the following 5 Step Process
The decision to sell your business can be overwhelming. That doesn’t mean the sales process should be. Instead, our straight-forward approach keeps you informed and involved throughout.
Above all, you can rest assured that we take the business sales process seriously. The security of your confidential information is our paramount concern. Prior to releasing any information, we require potential buyers to sign an official confidentiality agreement.
In addition, before disclosing any identifying information, we strive to ensure the potential buyer has the required financial resources and skills to advance the business. This saves you precious time and money and keeps the business sales process virtually free of frustration.
We also understand how distractions can stifle productivity. That’s why we always schedule meetings with potential buyers after business hours.
1) Prepare Your Business for Sale
Since we have experience on both sides of the table (seller and buyer), we know what potential buyers are seeking. So, we can guide you to present your business as a valuable and profitable purchase investment.
The process begins with a seller interview where you’ll fill out a brief questionnaire and provide basic financial information, including:
- P&L statements (three years)
- balance sheets (three years)
- tax returns (three years)
- current year-to-date P&L and balance sheet information
- and other required documentation
You’ll also have the opportunity to recast your financials to reflect all owner benefits. Doing so normalizes the operating income of your business before taxes.
It’s wise not to overlook the importance of this step. Research shows that preparing your business for sale before listing can add 10 percent or more to the final sales prices.
2) Valuation Preparation
In this step, you’ll meet again with our qualified and certified business intermediary (CBI) to review your custom business valuation. This will include a range of estimated market value and selling price details. Using the latest resources available, we can help you glean comparable prices for similar businesses in your area that have recently been sold.
Here is also where you’ll sign a listing agreement and submit a questionnaire providing details about the company, including products, employees, and other information.
3) Marketing Phase
As part of this step, the brokers listing information sheet (BLI) will be completed and approved for listing on all websites. Other information will also be gathered.
Next, the business will be listed on all websites and the property will also be marketed to any known corporate buyers. Research will also be conducted to identify new corporate buyers.
4) Inquiries, Meetings, and Offers
All inquiries will be accompanied by a non-disclosure agreement (NDA). Once potential buyers are approved, meetings will be scheduled.
In this discovery phase, you’ll get the chance to evaluate potential buyers. Next, you’ll make decisions on how or if to proceed (accept, counter, or decline).
This is also the step where the potential buyer will perform their due diligence to include accurate representation of data and financials, contingency removal, inventory evaluation, and other considerations. This process provides an opportunity for the buyer and seller to understand one another’s motivations.
5) Closing Phase
Once contingencies have been removed, the authorization form has been signed, and the buyer has furnished a deposit, the closing phase can begin.
At this time, buyer deposit funds will be wired to the closing attorney. Outstanding liens and payoffs (identified by the closing attorney) will be satisfied using seller proceeds, and all closing documents will be signed by both buyer and seller. The transaction is now complete.