selling a business

Selling Your Business? Do-It-Yourself is Risky Business!

When the owner of a business makes the decision to sell, he or she is taking a giant step that involves the emotions as well as the marketplace, each with its own set of complexities. Those sellers who are tempted to undertake the transaction on their own should understand both the process and the emotional environment that this process is set against. The steps outlined below are just some of the items for a successful sale. While these might seem daunting to the do-it-yourselfer, by engaging the help of a M&A Business Advisor, the seller can feel confident about what is often one of the major decisions of a lifetime. 1. Set the stage. What kind of impression will the business make on prospective buyers? The seller may be happy with a weathered sign (the rustic look) or weeds poking up through the pavement (the natural look), but the buyer might only think, “What a mess!” Equally problematic can be improvements planned by the seller that appeal to his or her sense of aesthetics … [Read more...]

Top Ten Ways to Avoid Wrecking a Deal When Selling A Business

Finalizing a deal is usually a complex process, and there is a good deal of room for error, misunderstandings, miscalculations, and good old-fashion wild cards.  That is why it is critical to carefully think through the deal process well in advance.  We’re going to explore the top ten steps you can take to avoid wrecking a deal when selling your business. Confidentiality – At the top of our “how not to wreck a deal list” is confidentiality.  It is vital that everyone involved in the deal takes steps to avoid a breach.  Experienced Business Brokers and M&A Advisors are experts at maintaining confidentiality. Flexibility  – The second tip on our list is to be Flexible! A lack of flexibility can absolutely destroy a deal. You shouldn’t go into a deal expecting to have all of your terms met and keep in mind every buyer and situation is different. Be Open to Negotiations – Just as it is critical to be flexible, it is also important to embrace the concept of negotiation.  Sellers are … [Read more...]

The Psychology of Selling Your Business – Are You Sure You’re Ready?

Most likely, selling your business is one of the biggest decisions of your life.  Unless you own a business, it is impossible to understand just how all-encompassing of a process it can be.  With that stated, it is important for business owners to step back and seriously reflect on whether or not they are truly ready to sell.  The psychological aspects of selling are not trivial.  Various aspects must be taken into consideration before initiating the process to sell beforehand to avoid all kinds of issues.  There are many reasons why it is vital to step back and think about whether or not you are really ready to sell your business.  Far too many business owners believe they are ready to sell, only to discover (much too late) that an executed sale may not be optimal.  Selling When There is No Other Choice  Selling a business because there is no other choice, such as situations concerning failing health, personal issues or problems with a business partner, isn’t a true choice at all.  In … [Read more...]

The Importance of Owner Flexibility When Selling a Business

You shouldn’t expect to sell your company overnight.  For every company that sells quickly, there are a hundred that take many months or even years to sell.  Having the correct mindset and understanding of what you must do ahead of time to prepare for the sale of your company will help you avoid a range of headaches and dramatically increase your overall chances of success. First, and arguably most importantly, you must have the right frame of mind.  Flexibility is a key attribute for any business owner looking to sell his or her business.  There are many variables involved in selling a business, and that means much can go wrong.  An inflexible owner can even irritate prospective buyers and inadvertently sabotage what could have otherwise been a workable deal.  Be Flexible on Price A key part of being flexible is to be ready and willing to accept a lower price. At the end of the day, the marketplace will determine what your business is worth.  There are many reasons why business owners … [Read more...]

How to Optimize Your Chances of Selling Your Business

The simple fact is that selling your business is likely to be the single most important financial decision you’ll ever make.  With this important fact in mind, it is essential that you prepare far in advance.  Let’s dive in and take a look at some of the key items you’ll want to check off your list before placing your business on the market. Think About Legalities When it comes to selling a business, legal issues should be at the forefront of your thoughts; after all, selling your business does involve the creation and execution of a complex and detailed legal agreement.  There are many times in life where it is possible to cut corners, but hiring a good lawyer or law firm is not one of those times.  Moreover, you’ll want to settle all litigation, environmental issues or other issues that could potentially derail a sale. Deal with Serious Buyers Working with a experienced Business Broker or M&A Advisor is an essential part of the selling process, as these professionals will help … [Read more...]

The Importance Of A Confidentiality Agreement When Selling a Business

When it comes to buying or selling a business, there is no replacement for a solid confidentiality agreement.  One of the key ways that Business Brokers / M&A Advisors are able to help buyers and sellers alike is through their extensive knowledge of confidentiality agreements and how best to implement them.  In this article, we will provide you with an overview of what you should expect out of your confidentiality agreements. A confidentiality agreement is a legal agreement that essentially forbids both buyers and sellers, as well as related parties such as agents, from disclosing information regarding the transition.  It is a best practice to have a confidentiality agreement in place before discussing the business in any way and especially before divulging key information on the operation of the business or trade secrets. While a confidentiality agreement can be used to keep the fact that a business is for sale private, that is only a small aspect of what modern confidentiality … [Read more...]

Four Common Seller Mistakes When Selling a Business

Sellers of businesses are just like everyone else in that they can make mistakes.  In this article, we’ll explore some of the most common mistakes that we see along with some of the repercussions.  1. Not Seeing the Buyer’s Point of View The first major mistake that sellers make is that they simply fail to look at the situation from the buyer’s perspective.  One of the smartest moves any seller can make is to step back and ask themselves two key questions.   “What information would I expect to see if I was thinking about buying this business?  “Would I trust the information being presented to me if I was the buyer?”  While there are many other questions sellers can ask to help reframe their thinking, these two simple questions can orient a seller’s thinking towards a buyer’s perspective.  Additionally, investing the time to understand the buyer’s position can help avoid a range of problems and help smooth out the negotiation process. It is also important to understand that buyers of … [Read more...]

Price or Terms: The Structure of the Deal When Selling a Business

An old saying in negotiating the sale of a business goes like this: The buyer says to the seller, “You name the price, and I get to name the terms.” Another saying used to explain the actual value of the term full price: “If we could find you a business that nets you $500,000 a year after debt service, and you could buy it for $100 down, would you really care what the full price was?” It seems that everyone is concerned only about full price.  And yet, the price is just part of the equation.  If a seller is willing to accept a relatively small down payment and carry the balance, a higher price can be achieved.  On the other hand, the more cash the seller wants up front, the lower the price. If the seller demands all cash, barring some form of outside financing, the price lowers – and, in most cases, the chance of selling decreases as well.  Even in cases where outside financing is used, such as through SBA, etc., the lender will do … [Read more...]

Confidential Business Reviews Should Establish Trust

When you are selling a business, your Business Broker or M&A Advisor will likely create a Comprehensive Business Review, or CBR.  This comprehensive document can then be presented to prospective buyers once they have signed all necessary confidentiality documentation.  It is essential that this document builds trust between both parties, as this will go a long way towards achieving a successful deal.  Be Honest The bottom line is that your CBR will be 95% positive.  The majority of the document will be dedicated towards selling and promoting your business.   Therefore, it only makes sense to disclose some potential problems.  When handled correctly, the disclosure of problems can actually be a strong asset.  For example, current weaknesses of your business could become strengths in the mind of the buyer.  For example, a business with a very poor online presence represents a substantial opportunity for a buyer to improve marketing and … [Read more...]

Essential Meeting Tips for Buyers & Sellers of Businesses

The buyer-seller meeting is quite often a “make or break” meeting.  Your Business Broker or M&A Advisor will do everything possible to ensure that this meeting goes as well as possible. It is vitally important to realize that rarely is there an offer before buyers and sellers actually meet.  The all-important offer usually comes directly after this all-important meeting.  As a result, you want to ensure that meetings are as positive and productive as possible. Buyers need to understand how the process of selling a business works and what is expected of them from the process. Buyers should also take the time to clearly express their background and financial capabilities to the seller since this is highly important to the seller. A lot of buyers dive into questions on the business without discussing their qualifications first. As sellers get more comfortable with buyers and a rapport is built, they will be more willing to share information and provide … [Read more...]

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M&A Business Advisors represents sellers and buyers of privately owned businesses in a wide range of industries in California and Nevada. Our services include Selling a Business, Buying a Business, Mergers & Acquisitions, Business Sales and Acquisitions, Valuations, Opinion of Value, SBA Finance and Business Consulting. Sell your Business, Buy a Business, How do I determine the Value of a Business, How do I Sell my Business Confidentially, What is a Safe Way to Sell my Business, How long does it take to Sell a Business, How do I Sell a Business in California, How do I Sell a Business in Nevada, Search Businesses for sale. We represent Sellers and Buyers in Southern California, Los Angeles County, Orange County, Ventura County, Santa Barbara County, Kern County, San Bernardino County, Riverside County, San Diego County, Los Angeles, Torrance, Gardena, South Bay, San Fernando Valley, San Gabriel, Upland, Woodland Hills, Chatsworth, North Hollywood, Van Nuys, Burbank, Glendale, Pasadena, Santa Clarita, Palmdale, Thousand Oaks, Ventura, Camarillo, Anaheim, Irvine, Santa Ana, Huntington Beach, Newport Beach, Fullerton, Laguna Beach, Aliso Viejo, Rancho Santa Margarita, Orange, Costa Mesa, Brea, Loa Alamitos, Mission Viejo, Fountain valley, San Clemente, Northern California, San Jose, San Francisco, Oakland, San Ramon, Napa, Sacramento, Nevada, Northern Nevada, Southern Nevada, Reno, Carson City, Tahoe, Las Vegas.