If you are looking to sell your company, how do you go about the process? This is a question that comes across many business owners during the course of their careers.
One of the most important starting points is calculating the value of the business so that you price it appropriately. This ensures the right price is assigned to the business. When proposing your business’s worth, ensure that you assess the asset worth, projected future revenue and goodwill worth. The next step is to find potential buyers through channels such as business sales agents, online advertising, word of mouth, existing network, trade publication, and newspaper advertising. Your business industry will determine how you should market your business in the most appropriate manner. Once you have located your preferred buyer, the next step is to negotiate with the buyer and ensure that the details of the business are true and accurate. After an agreement on price has been reached, next up is handling the initial deposit amount followed by the settlement period. The last steps to completing the sale of the biz fall on what to do with the existing staff. In most situations, layoffs tend to be administered.
Backtracking a little, as soon as the agreement has been reached, a business contract needs to be formulated detailing all the elements of sale: the transferred assets details, relevant liabilities, employees’ entitlement and responsibilities, statements addressing “what if” and any restrictions on using your brand after selling the business. Solicitors from both sides should be hired to go through the contract and address any issues that propose a problem.
As previously stated, existing employees of the business may be retained by the new employer or the transition may end their employment. Therefore it is recommended to let your employees know whether they will be transferred with the business to new management or will have their employment contract terminated.
Once the purchase of the business has been finalized, you won’t have any more responsibility to your employees. If by chance the employees are transferred to the acquirer, it is recommended that you provide any situations/details of your employees to the new management for a smooth transition.
Another important step that often gets over-looked is in relation to tax and legal issues. Consider the taxes your business is assessed and all insurance requirements. There are tax requirements that must be included in the price of the assets of the business. When you are done handling the legal matters of the business, the handover of the business along with all the necessary details such any licenses, permits and leases, complete issues of returns, installment notices and operation statements and transferring or cancelling the present business name. needs to be conduct for the process to come full circle.