Mistakes to Avoid When Selling Your Business
Many times business owners do not plan accordingly for a successful exit, and by the time they realize they could sell their business it can be complicated to do a successful sale in a rush. The process of selling a business can take time, especially during this economic crisis, transaction deals are taking longer and financing is more difficult since people are trying to protect their assets and maximize revenues as much as they can.
As a business owner you want to do what is best for your company and get the most out of a deal if you are planning to sell. Here we will share with you some mistakes to avoid when selling your business:
Not Preparing Well: The common mistake business owners do is to not prepare enough for selling their business. Just like preparing for anything important in life, having financials, legal documents, and paperwork ready and updated will be extremely beneficial to assess the transaction. We recommend to start preparing at least 2 years before the actual sale, this way it will give the advisors, and the buyer time to prepare for the deal.
Too Much Confidence & Not Paying for Third-Party Help: Being realistic is essential when you are trying to sell a business. Being overconfident that you will sell your business at a certain price just because you believe that is how much it is worth does not mean the deal will go through. You should get the help of advisors or M&A Consultants to give a proper valuation to your company.
Not Pre-Qualifying Buyers: To have a successful sale, a seller should do pre-qualification of buyers. Providing pre-qualification documents to the buyer can make them more interested in the deal by helping the buyer to understand more of the business. This can help the transaction to close sooner rather than later.
Miscommunication with the Buyer: As a seller, you should be in communication with your buyer and your advisors at all times to make sure the business is able to run effectively after the deal. It is important for the seller to make a smooth transition by checking that all processes and all employees are on the same page before the new buyer comes to run the business.
Selling a business doesn’t have to be an overcomplicated process if you take the right steps and ask help from professionals with experience.
For more mistakes to avoid, read the full article here:
