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Business For Sell - How to Put up a Business For Sale

assessing value get help in pursuit of the deal conclusion

Many people talk about how important it is to build businesses. And, for good reason. By building a business, one can create a huge amount of wealth for one’s self. But, almost as important as building a business is putting a business for sale after the owner has gotten everything he wants out of running it. This is a fantastic way to make money and get rid of all of the vast responsibility that comes with running such an endeavor. However, many people don’t know very much about the actual process of putting a business for sale.

Assessing Value

The first step is to assess the value of the business and write down why it should be worth that much money to any potential buyer. These reasons could include ownership of valuable properties, important copyrights or patents that bring in a steady stream of revenue, dealerships with national franchisers that continually do good business, or restaurants with loyal client bases. Once done listing the business’ strengths, list the weaknesses of the company. Maybe there are lawsuits pending, ther could be a looming possibility that the business could lose the lease on it’s headquarters, the patent could be ready to expire, government could be considering industry regulations, or other issues.

Get Help

Find a sounding board. Have a pro forma created to show the projections for the sale. Next, focus on finding a butter. Business brokers or investment bankers are the people that will help locate somebody to buy the company. Business brokers handle sales of companies that are worth less than five million dollars. The investment bankers take care of the larger business sales.

In Pursuit of the Deal

The business transactions attorney is a very important person in the process of selling a business. The business transactions attorney is a mergers and acquisitions specialist that should have had a very large amount of substantial experience with the activities of both selling and purchasing companies. This business transactions attorney should be involved in the process of putting the business for sale long before any of the legal documents have ever been signed. In fact, the business transactions attorney should be brought in before any of the important legal documents are even drafted. These documents include things like the confidentiality agreements, the letter of intent, the agreement with the investment banker or the broker, the contract of sale, and any sort of employment agreements or promissory notes that may be involved in the deal. It will probably be demanded by the lawyer of the buyer that he prepare the final purchasing agreement. This is fine, as long as he allows the business transactions attorney to look over it and negotiate the deal points.

An accountant should also be hid to help make sure that the business sale goes smoothly and is in the best interest of the seller. This accountant is necessary to handle everything that has to do with the planning for the payment of the federal income taxes. This is a very important part of the sale. If the federal income tax payment is handled improperly, the seller is just opening himself up to tremendous legal jeopardy. Fines and jail sentences can be very stiff. The court basically assumes that people who are involved in these transactions must have the money and knowledge that is necessary to file their taxes properly. For this reason, they assume foul play on the parts of the people who do not file properly and level harsh sentences on those they find in violation.

Conclusion

Putting a business for sale is a large task. It is easy for an owner to become overwhelmed by the stress and frustration that is caused by all of the complicated legal work that has to be done, not to mention the frustration that is caused by the process of actually finding a buyer who wants to purchase the company and will stick around throughout the entire process of purchasing the operation. It is extremely common for people to think they have a great deal in place and ready to be executed only to have one party suddenly fall out of the agreement. The purchase of a business is a big decision that requires many people to agree and a considerable amount of money. The owner must keep this in mind and realize that potential buyers will probably disappoint him. However, the business will eventually be sold to the right person. If the owner stops to consider things, he will realize that anyone who would back out of the agreement is not a good person to take over his business. The new owner must have the same passion and zeal for the work as the previous owner to ensure that the business will continue to prosper.

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