36 Things I Need To Sell Your Business

Attention Sellers:

Here’s What I Need From You At Our Listing Meeting

36 Things You Will Need To Sell Your Business - Jacksonville Business Broker - John Geiwitz

There is a lot of preparation that goes into marketing your business for sale.  You are asking people to part with, in many cases, their life’s savings or a substantial loan or note to purchase your business. The onus is on you, the seller, to provide as much information as possible. You get a better result when the information is presented in an easily digestible, illuminating manner such that a fair price can be agreed upon. Sometimes, through this process, owners are surprised by HOW MUCH their business is worth, and proud of all that has been accomplished.  Buyers appreciate a full preparation, and come to the table with a much better offer when they can see clearly all that is being offered.

Ready? Let’s dive right into my THIRTY-SIX point list!

1

LIST ALL SHAREHOLDERS OR PARTNERS

Are these people signatories on the business? Will they take part in the negotiations? It is important for me, as your business broker, to understand all of the appropriate parameters of the deal.

2

ANY RELATIVES OR EMPLOYEES THAT ARE NOT STAYING WITH THE NEW OWNER?

e.g. If a spouse is doing the books, it is customary for the spouse to also leave when the business is sold. Rarely is the spouse being paid, and even rare is “fair market rate”.  This could mean additional expenses under new ownership that might not be immediately visible to a buyer studying the Balance Sheet.

3

HAVE YOU EVER LISTED THE BUSINESS FOR SALE BEFORE

If a previous deal fell through as result of something that came up in Discovery, it is best to know about that upfront and take precautions to prevent a recurring situation.

4

HOW SOON WOULD YOU LIKE TO SELL YOUR BUSINESS?

Timing can determine how patient a seller will be on price and a particular type of buyer.

5

WHAT ARE YOU GOING TO DO AFTER WE SELL YOUR BUSINESS?

The answer to this question impacts how we reflect the amount of training a seller can offer to the buyer plus how wide (and how wide) the non-compete should be.

6

DO YOU OWN THE BUILDING OR PROPERTY?

If the owner owns the building and there are other lessees, this factors into the price. Ownership of land could mean we list the property separately from the business, or as a bundle. These are just some of the options we consider as we put together the marketing presentation.

7

ARE YOU CURRENT WITH ALL OF YOUR ACCOUNTS PAYABLE?

Outstanding payables are considered a Liability on behalf of the company and needs to be reported to any potential buyer. including back taxes, etc.

8

DO YOU OWN ALL OF THE ASSETS FF&E FREE AND CLEAR

FF & E = Fixtures, fittings and equipment, and when they are well-maintained they can be valuable assets to a new owner.  If they are being leased, that represents a cost for the buyer.

9

LIST OF ALL ASSETS AND EQUIPMENT THAT WILL CONVEY

An Asset List demonstrates a significant portion of a company’s value.

10

ESTIMATED REPLACEMENT VALUE ASSETS INCLUDED IN SALE?

Just because a piece of equipment is over 50 years old, does not diminish its value. (Consider: an Enigma Machine) However, a buyer has the right to know the replacement value of each item included in the sale.

11

CURRENT HOURS OF OPERATION

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12

HOURS THE OWNER WORKS PER WEEK

I always list whether the current owner works the business full-time or part-time. It speaks to potential and helps identify and narrow the buyer pool.

Call (904) 412-5771 to talk

about selling your own business.

13

YEARS ESTABLISHED?

How long the business has been in existence affects the name recognition and contributes to some of the intangibles of Good Will when we value a business for sale.

14

YEARS OWNED?

15

STATE OF INCORPORATION

Which state your company is registered in affects how much tax will be involved when the deed of ownership transfers. This is a much more complicated issue, of course, which I would be discussing with you at our first meeting.

16

EMPLOYEES (EXCLUDING OWNER)

17

# of MANAGERS

18

ORGANIZATION TYPE (LLC, SUB-S, ETC.)

19

IS THE BUSINESS RE-LOCATABLE

20

ARE THERE ANY LAWSUITS EXISTING OR PENDING?

21

ARE THERE ANY TAX LIENS?

22

WHAT SKILLS OR LICENSES REQUIRED TO OPERATE BUSINESS?

23

HOW LONG ARE YOU WILLING TO STAY ON TO TRAIN THE NEW OWNER?

24

ARE YOU WILLING TO SIGN A NON-COMPETE?

25

BUSINESS HISTORY

26

POTENTIAL GROWTH?

27

COMPETITIVE OVERVIEW?

28

BUILDING TYPE?

29

MONTHLY RENT/LEASE?

30

DOES RENT/LEASE INCLUDE INSURANCE, MAINTENANCE, AND TAXES?

31

LEASABLE SQUARE FEET?

32

WHAT IS THE LEASE EXPIRATION DATE?

33

DO YOU HAVE ANY LEASE OPTIONS?

34

IF YOU OWN THE REAL ESTATE HAVE YOU HAD A FORMAL APPRAISAL IN THE REAL ESTATE IN THE LAST 12 MONTHS?

IF YES, CAN YOU OBTAIN AND PROVIDE A COPY?

35

HOW MUCH HAVE YOU INVESTED IN LEASEHOLD IMPROVEMENTS (LHI) IN THE LAST 5 YEARS?

36

HOW MUCH INVENTORY (AVG. IN STOCK AT YOUR COST) DO YOU TYPICALLY HAVE ON HAND?

Note – Yes, it’s a lot of data. This is why owners find it helpful to work with a professional business broker. And this is just to list the business! Screening buyers, negotiating the deal and then getting it to the closing table – can you afford to do all that AND run your business every day?

Please call 904-412-5771 to schedule an appointment, for a professional presentation of your business for sale.

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