You've gambled your own savings and worked tirelessly to build a successful business.
Now you want to reap the financial rewards and sell your business, either to fund your retirement or because you've taken the business as far as you can and you want to try a new challenge.
What follows are the documents and information you need to disclose to the buyer and other important things to remember when selling your business.
Surely the most important component of the information you divulge to prospective buyers, the health of your statements will be pivotal in the sale price you agree. You can exaggerate your business's merits or downplay them, but cold, hard figures, detailing profits and losses, don't lie. You will need to furnish any prospective buyer with up to three years of statements, possibly certified by an accountant.
You must provide bank statements, which are required for financial due diligence performed by the buyer, covering at least three months of recent statements, although many buyers will demand a year's worth.
You should provide copies of customer contracts, which can stipulate pricing terms for each customer.
Inform the buyer of any contractual agreements you have entered into to conduct future work for a customer. Be clear on the likely duration of the work, the resources you must commit to it and how much the business is due to be paid.
You should provide your business license, which most businesses require, and be able to show that it is valid. An expired license is of no use to anyone.
Marketing and advertising
Many marketing and advertising campaigns are scheduled weeks or months in advance so the buyer will obviously need to know what's been planned, and what further financial outlay it entails.
You need the help of a lawyer to sell your business. The lawyer, who will be responsible for reviewing the terms of the purchase and sales agreement, can identify clauses disadvantageous to you. They can also formulate a confidentiality agreement to bind the buyer to not disclosing sensitive financial information to other parties.
The buyer needs to know about the different price tiers you charge to customers and how these are determined.
Any trademarks and copyrights must be transferred to the new owners. And you must disclose the terms of your intellectual property and how long it will remain valid for.
Achieving a sale
Selling your business can be daunting, protracted and stressful. Before you embark on the sales process, you must ask yourself whether you're really ready to let go of an asset you've dedicated years to building, and to embrace a new life, whether in retirement, semi-retirement or running another business.
And do you want to remain involved in the business post-sale? Offering to stay on in an advisory role after the sale can help sweeten the deal for the buyer.
Ready to sell? You are just 10 minutes away from advertising your business to 1.3 million prospective buyers. Sell your business today.