Keeping Business Sales Moving

Selling a business can take time, and it’s important to consider how the sale is going to play out prior to finding the buyer. The more prepared you are at the beginning of the process, the better chance you have of keeping the deal moving forward in a timely manner.

As brokers, we have noticed that this process has started to take longer than anyone would like, so below are some tips and things to consider.

Well prepared financials

Firstly, prior to going to market, it’s important to have well-prepared financials from your accountant – generally the last three years of verified financials – plus a year-to-date profit and loss. This will be the beginning of what buyers will want to see, and without solid financials, buyers won’t have anything to review.

Initially, buyers will likely want to see some payroll information and BAS statements – and will probably have other questions – so, to be prepared, ask yourself what you want to see if you were buying this business?

Be ready to react

Be wary not to give away any intellectual property and seek advice before sending anything sensitive. Having a good relationship with your accountant – and having your accountant aware that you are on the market or looking to sell – assists in the sales process.

Once you have found a buyer and agreed upon the terms of the sale, other things will need to be arranged accordingly. I would recommend thinking about these things prior to finding the buyer, so you are prepared and can react quickly during this phase of the sale.

During the due diligence phase, buyers will likely request further financial information and having your accountant available to produce that information quickly will aid in the sale.

Things to consider

You will also need to consider if a lease needs to be assigned to a new buyer, so understanding what will be required from your landlord earlier in the process will help.

If you have a solicitor, prior to going to market, it would be advisable to have a chat to them and see what capacity they have to produce a sales contract for your business.

I also recommend asking if your solicitor has experience in business sale contracts; if not consider looking for one that does as their experience will assist in the flow of the sale.

Buyer finance

Finance can be another roadblock in the sales process. Buyers are increasingly looking to finance deals, even if they have the cash available to purchase the business outright. Financing can be a better option for them. Identifying early that your buyer will be looking for finance will aid in keeping things flowing.

All businesses are different, and all sales will have things pop up that need to be discussed and dealt with. Thinking about what might arise – and being prepared for it – will also be beneficial. Things such as Work in Progress, staff entitlements, the handover period, and how gift vouchers will be dealt with are examples of things that need to be considered.

Keeping the deal flowing is critical to achieving a positive outcome. So, from the moment you accept an offer with a buyer, start setting timeframes and goals to achieve milestones throughout the sale. Being prepared and seeking the right advice is key to a smooth transaction.