The decision to list your business for sale may have been a long time coming. It may be your plan for funding retirement because you invested your savings in the company.
Selling your business may have been the ultimate goal when you created the company in the first place. You wanted to build something functional that was worth far more than the sum of its parts. You can then turn years of personal efforts into profit when another company or an individual decides to purchase your business.
Before you put the for sale sign out in front of your factory or retail space, there are certain important matters that you will need to address.
The future of your employee
At small- to medium-sized businesses, individual workers can have an outsized impact on the company’s success and overall performance. You may also have develops a strong personal relationship with individual staff members, some of which may have followed you from better-paying jobs elsewhere because they believed in your vision.
You need to potentially have conversations with your top workers before you list the company and arrange incentives so that they will stay on during the transition. You may also need to go to bat for them during the sale process so that the new owners treat them with the respect they deserve.
The liabilities your company has
Business isn’t all profit and growth. You may rely on revolving lines of credit to meet your operating costs before invoicing every month or may have financed the purchase of crucial company equipment, like fleet vehicles.
Your debts can affect the overall value of your company and how attractive it is to potential buyers. You may need to wait until you are in a more financially secure position if you want to maximize the returns on the sale of your business.
Your plans after the sale
If you secure a seven- or eight-figure sale for a company you spent decades growing, your dream may be to immediately head to someplace with beautiful sandy beaches for a vacation. However, the chances are quite good that the new owner is going to need transition support from you in addition to certain key staff members. You may need to provide training information or plan to stay behind and support the company as the new owner becomes comfortable with operations.
Addressing issues that can impact the success of your upcoming business sale now will lead to a smoother transaction later.