Selling your business | More than a financial decision

The prospect of selling your business can be both exciting and daunting. It is a huge undertaking for any business owner and often life changing, not just for an individual but for their whole family who have been a part of the journey.

The goal of selling a business is often thought of as solely financial, however for many business owners it is about considering the next phase of their life, both professionally and personally which could be retirement, or a new venture.

It is possible you have already planned for this moment and are now looking at making it happen. You want to crystalise the value of the long hours and hard work you have put into building your business – your team, customer base, products, and services, and building and maintaining your reputation.

What are your exit options?

There are several exit options to consider: from partial to 100% sale, to a trade buyer or a financial investor, selling the business to your management team, or listing on a public market. Depending on the maturity and scale of the business and your desired outcome, selecting the right option requires considered thought and market understanding. If you’re not familiar with some of these options, a great first step is to chat to an adviser to see what the alternatives are, and which will generate the outcome you are seeking.

How complex is the sale process to a trade or financial buyer?

Once you have been approached by a buyer or are seriously considering embarking on a sale, the actual sale process can be overwhelming and at points emotional, particularly if you are trying to run your business at the same time.

The reason a sale process can be so complex is because of the sheer number of different elements involved. Remember, finding a buyer is only the first 10% of the process, the proverbial tip of the iceberg. What lurks beneath is where we often see business owners flounder without advice. There are so many different concurrent streams in a transaction to consider in order to achieve a successful outcome. These include:

Timing the sale
Understanding the business value
Preparing detailed and accurate financial and marketing documents
Finding the right buyer willing to transact on conditions acceptable to you
Negotiating a favourable price and deal terms
Supporting due diligence
Negotiating legal contracts
And then fulfilling all the conditions that may be necessary to complete

The sale of your business is the ultimate reward for the risk and effort you have put in over many years and is worth doing properly, and with the right guidance.

With excellent preparation and the right team of advisers, you can significantly improve your chances of success, reduce stress, and create a fantastic outcome financially for owners, new opportunities for your employees, and a good investment for the ultimate buyer or investor.