What You Don’t Know Will Hurt You: Small Business Sales In Minnesota « Headstone
The author is a public speaker, author and Business Broker who wrote this sellers guide to facilitate business owners in the practice of selling their Minnesota small to medium sized businesses. Our company belongs to a global community of business brokers, intermediaries and M&A Professionals. We warmly welcome you into our network. As a valued sell-side client, we will work together as partners in the sale process. We will work diligently together to prepare you for meeting, dealing and finally negotiating with candidate acquirers for your business.
This helpful guide will resolve many questions and offer a number of practical forms and valuable tips. If you would enjoy receiving the Video Training and the entire 62 page e book with selling documents and forms, please contact us through our link contained in the Resource Box below.
Moving forward together, maintain the following points:
* Marketing, Advertising and Screening Buyers and finally selling a business is a process, not an event.
* The process is described in this guide.
* Your family has worked long and hard at building a profitable business; now you must work as hard at selling it.
* To achieve the highest fair market value, be certain to preserve confidentiality and the prosperity of the business.
* Be prepared with proper documentation.
* recognize buyer motivation, issues and concerns, as well so that balanced judgment rather than emotion will lead to an equally advantageous deal.
The amount of time required to sell your business, from the decision point until the completion of the transaction, can be months – or – as in some cases, even years.
Enclosed is a summary of the completed process:
1. Naturally, the first step is to make a strong commitment to sell the business and to the process in effectively bringing about the sale.
2. The 2nd step is in preparing all important documents, including a business appraisal, selling memorandum and offering documents.
3. Then we commence the advertising and marketing to locate qualified buyers.
4. Next, your broker notifies you of a qualified buyer, we have already made contact and screening of the prospective buyer has taken place (see page 12). (Price and terms will not be discussed here.)
5. Broker begins negotiations with deal structuring. (A discussion of pricing and terms here.)
6. After all issues have been resolved with an agreement has been reached to include price and terms, the prospective purchaser may submit a Letter of Intent / Purchase Offer to include earnest money check. (Important: Broker can be of assistance in obtaining the buyer financing to purchase the business, if needed.)
7. The buyer will finalize his or her due diligence before the closing transaction and you complete yours.
8. Upon Buyer and Seller concurrence that a sale is desirable, with the support of your advisor, attorney or CPA, a Definitive Purchase Agreement and all closing aspects of the sale are prepared.
Successfully completing the sale of your business opens the door to a new phase in your life. Whether you are selling to enter retirement, pursue other business opportunities, or just gain some time for yourself, proper execution of the selling process is important. Your broker closely supervises every step of the transaction to get the deal done and over the finish line.
Clearly, for most of us, selling a business is one of the most important or largest financial transactions we will deal with in our lives. Interestingly, it is often the least understood – or the least prepared for — in the business life cycle. Selling your business is the last step in three broad general stages of business:
1. Business start up (purchasing an established business or starting your own);
2. Maintaining your business (operations, care, building, improvement, relationships, and profitability)
3. Exiting (choosing an exit strategy from the business — for many of potential reasons — to a new owner who will begin the 3 stages all over again).
It is the life cycle of business: birth, growth and maintenance, and finally exiting that business entity.
There are many things to consider when selling your business and many challenges to successfully accomplishing that end. Perhaps one of the most difficult to appreciate fully is that someone different than you is likely to be interested in looking at or buying your business. That means they may want to know or see things that you feel are not important or not their business and they may ask for or say things that seem to suggest you are not telling them the whole story. Remember, you are a stranger to them just as they are strangers to you. And, as the old saying goes, “buyer beware” so most buyers want to look very carefully – perhaps at other businesses as well as yours — before they leap! The purpose of this guide is to give you a better overview of what to expect, what to prepare, and how to deal with the things that are likely to come up in the process of your selling your business so that it is more likely you will close successfully – at a fair price, sooner rather than later, and with less stress.
This manuscript is to benefit an increased knowledge of the business selling process and the variables associated with that process. It is not a recommendation to sell your business. This document is a tool to help you in the selling decision process. The final decision to sell, and a determination of the selling price, rests solely with the owner(s) of the business and professional advisors.
A Minnesota Business Broker hereby advises you to select your own asking price for your business. Depending on the circumstances and the ability to attract the correct candidate buyer to your business, the actual price the business finally brings may vary from the asking price you initially set. Factors to consider in arriving at your asking price would generally include:
* The amount of business cash flow
* Buyer Return On Investment
* The local and national economy
* Management style & influence
* The Age and life cycle of the industry
* Market value of all assets (including liquidation value)
* Market Interest rates
* Competition
* Location Location Location
* Employee base
* Personal needs and circumstances
The Deal Structure examples presented as Appendix C (visit our website) are for illustration purposes only. The legal and tax implications in the examples have not been considered. The precise terms and structure for the sale of your business should be determined thorough discussions with people you trust, who are looking out for your interests, typically your advisors, attorney and accountant. The sample documents presented in the appendix section are meant for illustration purposes only.
Again, you should carefully examine any documents involved in the sale of your business and may choose to have your professional advisors and or attorney review the actual documents for the sale of your business.
All figures represented in this guide are intended for illustration purposes only and do not represent any factual or audited numbers. Accordingly, there have been no representations, expressed or implied, as to the accuracy or relevance of the financial or other information contained herein.
Please visit our website within the Resource Box below to obtain the complete Appendixes and Selling Forms included in the Sellers Guide.
Looking to find the Best Minnesota Business Broker to Sell Your business? Minnesota Business Brokers then visit www.Minnesota-BusinessForSale.com. Free 12 Step Video and e book
Tags: accounting, advertising, advisors, Business, business finance, business opportunities, business sales, Business Valuation, consultants, marketing, small business
This entry was posted on Thursday, August 5th, 2010 at 5:10 pm and is filed under Business.
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