Steps You Should Take When Selling a Business

If you are looking for information on how to sell a small business there are several resources available to help you. You can speak with your lawyer, accountant or a business broker for their advice.

Some people choose not to deal with a business broker and try to sell their business privately – without using the services of a business broker. This article will give you some quick tips on how to sell a small business privately.

The first thing that is recommended is to assemble your professional advisors. Even though you're trying to sell by yourself you will still want to have a professional team in place to help guide you through the process.

Your lawyer will be an invaluable asset and give you legal advice and the documentation and contracts required to sell.

Find a lawyer that has business experience who has a strong background and can teach you the ropes on how to sell a small business.

You will also want to have a good accountant to help you with valuing your business and preparing your books.

An accountant is an invaluable resource for you as a private seller and will also be able to teach you the 'ins and outs' on how to sell a small business from their perspective.

You will also want to prepare your business so that it is ready for sale. You will want the actual location to be in order and operating efficiently.

If you decide to sell the business confidentially then you will need to figure out a way to show prospective buyers your business during off-hours when employees will not be there.

You should also ask prospective buyers to sign a confidentiality agreement of a non-disclosure agreement. Again, this is something your lawyer should cover with you when you consult with him or her on how to sell a small business.

You obviously will need to then find a buyer for your business. There are several ways your can go about doing this.

Advertising online is a great option. Online advertising has many advantages – 2/4 exposure, confidential, you can reach buyers from all different locations, longer ads, pictures, cost effective. You can also try newspaper advertising, word of mouth referrals or other traditional forms of advertising. Also talk to other small business owners that have sold.

Mention that you would like to learn how to sell a small business and try to get their input. Learn from their experience.

Once you do find a prospective business buyer you then have to come to an agreement. Consult with your lawyer on deal terms and don't sign anything without having him or her review it fist.

There are many different caveats to consider when structuring a deal and you want to make sure you don't expose yourself to any risk during the transaction. This is a critical time to lean on your advisors who have the experience in how to sell a small business.

Selling a business privately can be a money saving move. As a business seller, you would save on the business broker's commission which could be up to 10% of the selling price.

Just be careful you don't cut any corners on the actual handing of the transaction, as business brokers do bring valuable experience in how to sell a small business to the table so you will want to fill that gap if you go it alone.

All content posted is not a substitute for legal, accounting or other professional advice and not intended to be relied on as such. We always recommend that you contact your own advisors for their input.