For many people selling a business is a once in a lifetime experience. Our goal is to make sure that you find it an interesting, even exciting and fulfilling process, rather than one which is frustrating, nerve wracking and mysterious.
We regularly work with clients to plan and negotiate the best deal for their needs taking into account their ultimate goals and long and short term plans. In doing this no two business sales are the same and we help with a myriad of issues including dealing with the sale agreement, due diligence, disclosures, restructuring, bank financing, valuations, directors service agreements and the transfer and licensing of intellectual property and other rights to mention but a few.
We have pulled together the Corporate & Commercial Team’s top tips for someone who is thinking about selling their business and summarised these below.
Kirstie Allsopp has been advising home owners on how to make their houses as attractive as possible to potential buyers for years. Kirstie comments that “People make a decision on whether they want to live somewhere in the first 11 seconds of walking into a property. If viewers walk into your hall and there’s clutter and mess everywhere, you’ve already lost that potential buyer”. This can easily be applied to the sale of a business.
Presenting a potential buyer with a business which is organised, well run, has all necessary documents in place, organised finances and is compliant with legal requirements is not only reassuring, but likely to lead to a quicker sale process and will help to maximise how much money you receive on completion. The more comfortable a buyer feels about your business and the less concerned they are about risks that they might inherit, the better!
We are all busy working in and running our businesses. Do not underestimate how much time it will take to sit back and think about your business objectively, putting yourself in the shoes of a potential buyer. Planning for a sale early and giving yourself at least 6 to 12 months to get the house in order will make the process easier and detract less from your day job.
The sale process can be stressful, so finding people that you like dealing with is hugely important. Make sure that you have a team of advisers that you know and trust and who can get to know you and your business. Understanding a business and a client’s ultimate goals and plans allows advice to be tailored with that in mind. If advice has to be given under the time pressure of an imminent deadline, your advisers will not be able to tailor this to the same extent and you won’t have the time to reflect on the advice that has been given.
Engaging with your lawyer and your accountant early will enable you to make informed decisions about the sale, including what type of sale will be the most beneficial to you.
You will be integral to the process, have a number of decisions to make and will need to provide the buyer with detailed information about your business. This might be at a time when no one else in the business knows about the sale, so be prepared to dedicate time to properly engage with the process and think about how you will get the information that you need from those you work with.
Buyers and sellers tend to become increasingly committed to the sale process as time passes, but do remember that a buyer can walk away at any time until the documents are signed and completed. It’s very important to remember that you can do the same.
A seller who has emotionally committed to the transaction completing may find themselves under pressure from a buyer to make decisions that they wouldn’t have done, had they been prepared to walk away. Keep focused on what is unacceptable to you, so that you can be robust in negotiating.
Our expert Corporate & Commercial Team has an extensive experience in advising a wide range of domestic and international businesses of all sizes and in multiple business sectors. Our team can guide you at the initial stages, right through to the detail of all of the transactional documents and successful completion.
If you are thinking of selling your business, we can work with you to ensure that you have peace of mind during your transaction.
If you’d like to know more about selling a business, our upcoming free seminar may be of interest to you.