How long to sell a business?
Generally it takes between five to eight months to sell most businesses. Some businesses will take longer to sell, while others will sell in a shorter period of time. The sooner all the information is gathered that is needed, the sooner the marketing process can begin. .
What happens when there is a buyer for a business?
When a buyer is interested in a business, they will submit an offer in writing. This offer will often have subject conditions. Usually, they concern a full review of financial records, a review of the lease arrangements/landlord approval, franchise agreement (if applicable) and other details of the business. You may accept the offer as is, or you may counter the offer, or decline the offer.
It is important to look at the offer it carefully. It may be lacking in some areas, but may have some positives to seriously consider. All offers should be looked at carefully.
Once you and the buyer are in agreement, both of you will work to satisfy and remove the subject conditions. It is important to cooperate in this process. The buyer may bring their lawyer and accountant to help them review the information. When all the conditions have been met, subject removal will occur.
How you can help sell your business?
Price: It is important that the business be priced properly. Overpricing can easily often backfire as buyers often will refuse to look at an overpriced business. Buyers want cash flow and they need to be certain that the business can be sustained. A Buyer will expect that to service the debts/cost of sales, and receive a reasonable salary to start. The business must be deemed by the Buyer to be a good investment.
Financials: First and foremost a buyer will want up-to-date financial information. Generally, if you cannot prove it, a Buyer won’t pay for it. Buyers usually request to receive the past 2-3 years of financials from your accountant.
Paperwork: Copy of the current lease, franchise agreement (if applicable) employee info (f/t, p/t), equipment list ,and other info you deem to be of interest to a Buyer
What your agent can and can't do for you?
Your Business broker is a professionals who will facilitate the sale of your business. Your agent can help to determine the price of your business, and how to structure the sale. They can market your business, assist in negotiating a offer , and work with you until the transaction is closed. Your agent can also assist the buyer with the business buying process.
However your agent is not a magician that can sell an overpriced business. Most businesses are saleable when priced and structured properly. Only the marketplace can determine what a business will sell for. Your agent cannot create a buyer, but with marketing they can ensure that if there is a Buyer out there they will find them.