What should I consider before I start the process of selling my business?

 People sell their businesses for numerous reasons. It is not an easy decision, but everyday contracts are being signed and transactions are occurring. A person who wishes to pass on their business to a new administration must be careful, however, for the process is not as simple as it may sound. 

Selling a business requires a lot of attention to detail and time to analyse each step of the process, and it is not something you can finish overnight. The magnitude of the operation is enough to stress from small business owners to the most experienced corporate senior. 

For this reason, it is better to take a look at what you should consider before selling your business.

Planning

Much like starting a new business, selling one demands planning and it all starts with the question “Should I sell my business?”. 

To answer yes, you must first try to imagine what you will do after you sell it. Are you retiring, using the money to buy another company or starting over fresh with a new business of your own? Considering your goal first is essential to trace a plan that allows you to achieve it. 

After you are sure that you are going to sell, it is a smart move to consult with a corporate lawyer, who will provide you with valuable advice on what to do next. They will guide you through the requirements and documentation that you need to gather before you can start talking to potential buyers. Relying on a professional is the best you can do for yourself, as it is much better to have a third party other than yourself take an expert look at your business and help you make the perfect decisions. 

As you organise everything you need in order to sell your business, you should as well be figuring out the next chapters of your life. If by selling your company, you are opening doors to go forward in life, then it is best to have both goals synchronised as you go.

Study The Market

There is no use in putting your business out for sale if there is no one to buy it from you or if you are not going to profit as much as you could from it. Because of that, it is necessary that you study the market around you to figure out a strategy and when it is the best time to start negotiations. 

You must be equipped with two key tools: your lawyer, and your peers. Corporate lawyers in Calgary can help you identify opportunities in the market, as they are constantly dealing with a variety of clients and have an experience that you otherwise would not be able to gather so easily. They can advise you if the time is right and what type of buyer you should be focusing on finding. 

You can also find this kind of information with your peers. Use your network to connect with other business owners and assess the market, or just use the time to ask for guidance. Chances are that more than one person will be able to tell you about a business they sold and how they did it. You can even ask for law firm recommendations from them. Just be careful to not disclose too much about your intentions and risk exposing yourself—you still have a business to take care of, after all, and being too open can leave you vulnerable in the market that you are trying to understand.

Price and Taxes

Another thing you must be concerned about when selling your business is money matters. First and foremost, you must know how much your company is worth. 

Your corporate lawyer can also help you with that: They can arrange a valuation for you to have a grasp on how much you can ask for your entire business. There are a few methods you can use to make this assessment based on the characteristics of your company, but in general, those will be essential for two things: starting negotiations with potential buyers and identifying other financial tasks you need to complete before selling. 

Said tasks are mostly related to taxes, but can also include shares. You must make sure that the accounting in your business is all good to go. The last thing you want is to be held responsible in the future for unpaid taxes that you simply did not see when planning how to sell your company. 

As the bureaucratic aspect of these transactions is often weary, consider asking for an expert’s eye to do it for you.

Finding a Buyer

When it is finally time for you to find an appropriate buyer, you will need a set course to start. If you are an active member of your industry and made connections throughout your time with your company, this should not be a problem for you. 

There are countless business owners out there who are constantly seeking new opportunities and would gladly take your company out of your hands. The trick here is to know who to sell to. 

You should consider the reputation of the buyer as much as their assets. Remember that you are looking for a deal like any other you have already closed as the head of your company, so you should not feel intimidated just because you are willing to sell. It is only when you are actively trying to find buyers that you should disclose your intentions as a seller, in order to protect all parties involved. A lot of buyers prefer to stay away from spotlights in order to conduct a smooth transaction. 

Consider the likelihood of your buyer not fulfilling their obligations in the transaction, and how selling your business to them may affect your public image. Then, make a list of candidates that you would wish to talk to and have as potential buyers. Networking skills here are of the utmost importance.

Negotiating 

Before you can sell your business, you must prepare for negotiations. This part is going to be the core of your sale process, and it requires months of prior development in order to be successful. 

During negotiations, you have to lay all of your best cards on the table, using everything that you learned about the market, prices and buyers to win the jackpot. Your buyers must know that you came prepared, and that you know what you are doing—they must see that you studied for it, and that you are ready to conduct the transaction. 

It also works in your favour to have a lawyer by your side: not only the buyers will know that you mean serious business, but also that you are equipped to make the best deal. Together, you can assess the potential buyers, establish connections and find a middle ground to work on. 

Being well prepared makes all difference when selling a business. It avoids surprises and obstacles that would otherwise come in your way of achieving your goals and passing on to the next chapter of your life. Before you can take the steps that will lead you to closing a deal, you must make arrangements and spend a few months planning. 

To not be overwhelmed with work, and to separate yourself emotionally from the process, find a corporate lawyer in Calgary to assist you in selling your business—it will only benefit you in creating a perfect plan.