5 Steps to Navigating a Business Sale
The process of selling a business can come with many factors to consider. For first-time founders and owners, it can be an emotional time as you consider the future of the company you helped build, while seasoned sellers may miss important steps from being on "autopilot" in the process. Fortunately, the team at Reno & Zahm LLP has created this checklist to help you find the right business partner, sell your business, and feel confident in its future.
1. Assess Your Readiness
Before you start selling your business, it is crucial to evaluate if now is the right time for you to do so. Consider factors such as market conditions, customer satisfaction, and industry trends to decide whether or not you are ready to sell.
2. Find the Right Partner
Take the time to research and find the right person or company to purchase your business. Investigate potential buyers, evaluate their track record for fairness and knowledge in the industry, and review any contracts or agreements with the sale.
3. Prepare Financial Statements
Now is the time to compile your financial information into one document to present to potential buyers. Ensure you include information such as cash flow, income statements, and balance sheets. Not having this information accurately and thoroughly prepared may leave you vulnerable to lawsuits if the buyer feels they weren't given a fair deal.
4. Negotiate the Price
Once you have found a buyer, it is time to negotiate a fair price for your business. Consider any additional services or items that may come with the sale, such as equipment, inventory, and intellectual property. It’s also important to factor in your current staff and what this transition may look like for them — will they be staying? Will there be a change in their salary? This can all be factored into the price.
5. Plan for the Future
Make sure you have a plan for what will happen to the business once it is sold. Will there be a transition period? What about any existing contracts or agreements? These factors should all be discussed and agreed upon before the sale is complete.
When to Hire an Attorney in the Process
Hiring an attorney is a valuable investment for those looking to sell their business. An experienced lawyer can help you draft contracts, review legal documents, and negotiate the best deal for you and your company.
Reno & Zahm LLP has just reached its 100th year of helping Rockford individuals and businesses navigate the legal process. In this time, we've become known as a valued and respected part of the community and are proud to serve those who come to us for help. Schedule a consultation by calling (815) 987-4050 to discuss your options.
The blog published by Reno & Zahm LLP is available for informational purposes only and is not considered legal advice on any subject matter. By viewing blog posts, the reader understands there is no attorney-client relationship between the reader and the blog publisher. The blog should not be used as a substitute for legal advice from a licensed professional attorney, and readers are urged to consult legal counsel on any specific legal questions concerning a specific situation.