Selling your business

Steps of selling a business.

There are many reasons for wanting to sell a business, but the reasons don’t matter as much as the process. You need to know what you are doing, the rules to follow when dealing with the buyer and the after-sale obligations. If you are planning to sell your business, here are things you should do.

Ensure selling is the best decision

This boils down to knowing your reason for selling. Buyers will ask, so it is only right that you know the reason too. If the sale is to solve a financial problem, it is better if you try and get help from a financial professional who will let you know if you are making a good choice. This is because selling also comes with financial obligations such as paying employees entitlements and the taxes from sales of your asset.

Decide who will handle the sale

You can decide to handle the sale yourself or use an expert. It is usually better to use an expert, and you can look for a reputable accountant, solicitor, or business broker who will handle the sale. A business broker is a professional who handles the sale and purchase of businesses. They know the requirement and will give you the necessary advice for sale as well as let you know the profitability of the business. Using a professional will make the process smoother.

Decide what you are selling

You need to know what you are, including in the sale of the business as this will affect the valuation. Determine if it is an outright sale with all business assets. If not, which assets are you not selling, will you be selling the registered business name and intellectual property? Are you also selling property owned by the business?

Draft a contract

The contract usually prepared by an intermediary contains everything agreed upon.

Take care of employees

They should know about the sale and get all the necessary notice and payments.

Finalise your legal and tax issues

Once you have done this, you can transfer the business to a new owner.

Value the business

Business valuation is all about determining what your business is worth so you can set how much you will sell it. There are different ways of valuing your business to arrive at its worth.

Finding buyers

Getting buyers for your business can be done in different ways. You can choose to advertise it using any of these methods.

Using real estate agents or business broker, Traditional and digital media, Existing networks of friends, family, employees, etc. Customers of the business, Word of mouth. Your method will depend on the type of business and the industry you are in as well as your contacts. You should also make sure you are familiar with the rules so you will know what to disclose to potential buyers.

Negotiate sale

You and the buyer have to agree on the sale price, settlement period, deposit amount, handover training where it is needed, and arrangements for the staff.