DISCLAIMER
These articles are for general information purposes only
and do not constitute legal, accounting or other
professional advice. Important financial and legal
decisions should be made only after seeking appropriate
professional advice based on your specific situation.
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Will You Get Top Dollar When You Sell Your Business ?
by Noel Peebles
Author of "Sell Your Business The Easy Way"
Selling your business will probably be your biggest sale ever.
But, to get the best price you'll need to satisfy your buyer
on two points. Firstly, your company should be showing good
returns. Secondly, there needs to be a strong likelihood that
this trend will continue.
This is why you (as current owner), have an important part to
play in the transition period during and after the sale.
Your customers and clients may be watching the changeover very
closely. If you have a successful business, then it is fair
to assume that your customers have grown to like you and the way you
run your business.
Remember, most people don’t like change, so the transition is
critical to make sure that your customers and clients remain with
the new owners. No customers... no business !
Here's what I mean. When selling one of my businesses to a senior
banking executive, I remember a comment he made just before signing
the contract. It was something like this:
"I have seen so many people
buy a successful business, rush in and change everything and then
lose everything."
He went on to add,
"You are running an extremely
profitable business, so you must be doing something right. I
am not going to change anything, probably for at least a year, or
until I find better way to do things."
He kept his word and the business continued to perform
exceptionally well. Eventually he did make changes, but he
did it from a position of knowledge... and with understanding of the
market requirements. A smart cookie!
However, it is not always like that. The new owners may
not want you involved. This is something you need to be
mentally prepared for. Don't automatically assume there will
be a place for you, even in a part-time or consulting role.
Regardless of your ability, they may not want you to be involved.
A new broom sweeps clean. The new owners could see you
as a threat to the vision they have for the business.
Naturally, when things go wrong, it is likely you will be blamed
for selling them "a dog."
On the other hand, the new owners may want your help. They
may want your experience and full support during the changeover
period. They may even want you to stick-around for a while until
they have come to grips with their new venture. The level of
support you offer will need to be negotiated as part of the sale
contract.
You, on the other hand, may want to cut your ties as quickly as
possible after take-over day. I mean, let's face it - selling
the business could represent the end of a long drawn-out sales
process. You may just want to cut your ties and move on.
So there you have it. You'll need to think about the likely needs
of the buyer and mentally prepare yourself for the different
scenarios that could follow.
And remember your level of on-going support may be another
bargaining chip for you to play in your biggest sale ever !
This Article is copyright © Noel Peebles
Author "Sell Your Business The Easy
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