Is your New Year resolution to sell your business?
If you are thinking of selling your business in the relatively near future – say later this year or within the next year or two – now is a good time to consider your options. You most certainly need to carefully plan your exit from the business and thoroughly prepare it for disposal before offering it for sale. If you should fail to do this it will almost certainly take longer to sell (if indeed it sells at all) and you will not achieve a price that might otherwise have been possible. Too many businesses are ‘undersold’ for lack of disciplined preparation!
Fundamental decisions need to be made, such as whether your business should be offered for sale on a goodwill and fixed assets basis or, in the case of a company owned business, whether a sale should be based on a disposal of the company shares. (There will be tax implications to take into account, of course, but you will also need to understand the market’s attitude to acquiring companies as opposed to businesses – not just buyers, but also their accountants, other advisors and lenders). If you personally, or your company, own the business premises will you want to sell the freehold property with the business or offer a lease? (Again there are tax and other implications to consider).
There are also other things for you to consider. Who might be interested in buying your business – an individual, a competitor, one of your suppliers, etc. – and how should it be offered for sale? What information about your business are prospective buyers (and their professional advisers and lenders) likely to want? Should you inform your customers and/or staff of your intention to sell (rather than run the risk of them finding out through the ‘grapevine’)? Who should you ask to give you advice as to the saleability and value of your business and do you want realistic and reliable advice or someone to tell you that it’s worth far more than the market is prepared to pay (the sort of advice one gets from selling agents who demand sizeable ‘up-front’ contributions towards their costs of handling the sale of businesses before they will accept selling instructions)? These are but a few of the matters that you need to contemplate, but where do you start?
If you have a business in the industrial, commercial or services sectors you should have a discreet and confidential conversation with a specialist agent with significant experience and expertise in these sectors. So, for businesses such as engineering, joinery, manufacturing, distribution, wholesaling, building and construction, transport and haulage, automotive trades etc. as well as internet based businesses and those in the service industry sectors, including professional services, it would be wise to contact Beardsley Theobalds – the only business transfer agency in the South West which concentrates solely on these market sectors. Such businesses, of course, are generally (but not always) located on industrial or trading estates, business parks and other suburban or out-of-town locations and a considerable and growing number are operated from owners’ homes. So, if your business is one which is similar to these and if you are thinking of selling, maybe it’s time for you to take your first step of the journey which lies ahead – a journey which will not necessarily be short or easy, but one which could be a lot smoother and more rewarding if you adopt the right advice!
Roger Mundy, Managing Director, Beardsley Theobalds