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Initial considerations in selling a business

The factors that need to be considered in selling a business and how a professional team of business brokers can help make the process easy

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Initial considerations in selling a business

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  1. The key questions that need to be asked in order to make sure that the business is ready to stand the close scrutiny of potential purchasers Initial considerations in selling a business

  2. Selling a business is a close partnership between the outgoing management and their appointed professional representatives.

  3. What are the reasons for the sale? Whatever the reasons, they need to be credible and capable of being communicated to buyers during the early stages of the sale process.

  4. Can the business function effectively without the direct involvement of the current management? If the business is totally owner dependent potential purchasers will recognise this very quickly. This will be an important factor for both trade and private purchasers. If necessary we will help you to ensure that the business is capable of continuing effectively without the day to day involvement of the current management. The level of training and ongoing support you are able to give your purchasers may also be a key consideration.

  5. What is the preferred exit route of the current owners? It will often be possible for us to negotiate a higher price in these ‘earn out’ situations as the buyers are seeking to limit their potential downside.

  6. We need to establish our client’s preference from the outset as this will have a bearing on how we market the business and negotiate the sale. At this point the outgoing owners will need to think about the tax implications of their exit. Advice will need to be sought from the company accountant or a tax expert. We will need to understand at the outset the preferred structure of the transaction as this will impact on the way the business is presented to prospective purchasers.

  7. Is the financial information in order and up to date? Once we have established genuine interest from a qualified prospect and obtained an undertaking of confidentiality they will expect to be provided with an Information Memorandum and this document will contain relevant financial data. We will need to review all current and historical financial information. This is a vital part of the valuation process.

  8. How does the business look from an outside perspective? Our suggestions may range from a redecoration of the reception area to investment in new technology or equipment. First impressions are lasting impressions is a well worn phrase. We will undertake an initial assessment and, if necessary, give practical advice in terms of what might need to be done to ensure a good first impression.

  9. Thanks to the professionals atfor sharing their expertise and the details in this presentation. View their website at http://www.venturabusinessbrokers.co.uk/for more information.

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