Useful pointers for when selling a business

THE SELLING PROCESS

<!--[if !supportLists]-->1. <!--[endif]-->Consider, and make the initial decision to sell your business.

<!--[if !supportLists]-->2. <!--[endif]-->Evaluate your business and establish a preliminary asking price.

<!--[if !supportLists]-->3. <!--[endif]-->Consider the Tax implications relating to Capital Gains Tax and other taxation issues.

<!--[if !supportLists]-->4. <!--[endif]-->Engage your professional advisors and a broker to represent you.

<!--[if !supportLists]-->5. <!--[endif]-->Conduct a thorough due diligence of your business.

<!--[if !supportLists]-->6. <!--[endif]--> Prepare a detailed selling memorandum for the business.

<!--[if !supportLists]-->7. <!--[endif]-->Identify the source of qualified potential buyers.

<!--[if !supportLists]-->8. <!--[endif]-->Market the business to potential buyers.

<!--[if !supportLists]-->9. <!--[endif]-->Negotiate with and receive offers from interested buyers.

<!--[if !supportLists]-->10. <!--[endif]-->Conduct a detailed due diligence on the buyers who are finalists.

<!--[if !supportLists]-->11. <!--[endif]-->Execute a letter of intent with the proposed buyer.

<!--[if !supportLists]-->12. <!--[endif]-->Assist the buyer with the due diligence.

<!--[if !supportLists]-->13. <!--[endif]-->Structure and complete documentation for the sale.

<!--[if !supportLists]-->14. <!--[endif]-->Sign the purchase agreement.

<!--[if !supportLists]-->15. <!--[endif]-->Satisfy the conditions to the closing.

<!--[if !supportLists]-->16. <!--[endif]--> Close the sale.

PREPARING TO SELL A BUSINESS

<!--[if !supportLists]-->1. <!--[endif]-->Ensure that your accounting records are up to date.

<!--[if !supportLists]-->2. <!--[endif]-->Clean up your premises. Neatness and good housekeeping creates a good impression.

<!--[if !supportLists]-->3. <!--[endif]-->Prepare information in advance that an interested buyer will usually ask for:

- Schedule of Fixed Assets and valuation

- Summary of Inventory

- List of accounts receivable

- Summary of leased/rented assets and equipment

- Copy of lease covering premises

- Copies of all pertinent contracts

<!--[if !supportLists]-->4. <!--[endif]-->If you are basing your asking price on earnings, then have at least the last three years financial statements available.

<!--[if !supportLists]-->5. <!--[endif]-->Once all of the above are prepared, call in a reliable broker to provide an assessment and valuation.

<!--[if !supportLists]-->6. <!--[endif]-->Many sellers represent themselves and end up doing a bad job because they have wanted to save the Broker's commission!

Avoid this trap - appoint a professional - you will benefit in the long run.