Common Mistakes Business Owners Make When They Sell A Business! — John Denton on Getting Businesses Ready For Sale

Which would YOU prefer; a nice relaxed retirement or litigation? 

Sorry! Was that a bit blunt? 

I’d rather stir business owners up now than let them find out TOO LATE that their business is not saleable or will not sell for the amount they need! Worse still, the business sale could end up in expensive and lengthy LITIGATION.

Sadly, TOO LATE and LITIGATION are all too common.

Selling a business privately is a complex and lengthy process with many traps for the unwary owner to fall in to. Some of these can end up in litigation.

What can you do to avoid TOO LATE or LITIGATION?

What are some of the common mistakes owners make?

(1) I’ve had my business for 30 years it must be worth a $1 million 
WRONG! Whilst longevity is a factor it doesn’t affect the market value very much.

(2) I’ll just run an advertisement on the internet and buyers will stampede to my door!
WRONG! You may get a lot of callers and waste hours dealing with them, however the best buyers don’t come this way.

(3) It’s a waste of money engaging a lawyer and using a sale agreement. I’ll just write something up with the buyer.
WRONG! You most definitely need a good lawyer involved to protect both parties and avoid litigation after the sale.

(4) My business is a simple one. As long as the buyer offers me the asking price that’s all I need to agree.
WRONG! There are numerous things that need to be discussed and agreed at the offer stage. Then everything needs to be in the buy / sell agreement before both parties sign. Failure to do this thoroughly can end up in litigation after the sale.

(5) That’s it, we’ve signed the sale agreement so I can slow down now and book my flights to Bali!
WRONG! The seller has an obligation to the buyer to keep running the business as they always have until settlement. Many sales fall through because of things which come out in due diligence! Sometimes the buyer will not get finance. It’s not over until the money is in the bank! If you let the business slow down and then end up keeping it.

This is just a very small list of the things that need to be dealt with when selling a business privately. Look out for more ‘common mistakes’ in Part II, coming soon…..

Common Mistakes Business Owners Make When They Sell A Business! — John Denton on Getting Businesses Ready For Sale:

For additional information regarding Florida business sales, acquisitions and valuations, please contact Eric J. Gall at info@buysellflbiz.com or 239.738.6227. Also, visit our Florida Business Exchange website at www.fbxbrokers.com and my personal website at www.buysellflbiz.com.