How your Business Broker can help you Prepare your Business For Sale

How your Business Broker can help you Prepare your Business For Sale

Decided to sell your business but not sure how to prepare your business for sale?

If you want to get the most out of the sale of your business, you need to not only ensure your business is running as professionally and profitably as possible…

…but you also need to focus on the five key areas of business sale preparation: strategic, financial, operational, physical and emotional preparation.

Well before your business actually goes to market, your business broker’s objective viewpoint can provide valuable input and a fresh perspective to help you assess just how prepared you really are to sell your business.

Let’s take a closer look at each of the five areas of business sale preparation.

Strategic Preparation

Strategic Preparation

Strategic preparation is all about the big picture and really showcasing both the existing value of your business and its potential to any buyers.

Your business broker will look at your business from an objective point of view with fresh eyes, bringing your attention to the good points you’ll want to highlight as well as any aspects that might cause a buyer concern.

They will also make your business easier to buy by helping you to organise and document all of the essential business information that will be useful to a buyer, such as systems and processes, into one central location.

For example, our innovative Brilliant Businesses’ Data Vaults provide secure cloud-based document storage that keeps all of the stakeholders informed with real-time access to all of the important documentation they need.

Creating a growth plan is another important aspect of strategic preparation that your business broker can help you with. A growth plan helps a buyer see the opportunities for expansion and diversification, allowing them to emotionally connect with your business and visualise how they would really make it their own.

Financial Preparation

Financial Preparation

Before you take your business to market, you need to know and understand all your numbers – past, present and future – so you can clearly explain them to any prospects.

Get your paperwork in order – your broker will understand exactly what a prospect will want to see as part of their due diligence when evaluating your business, including your annual accounts, BAS returns, tax returns, bank statements, balance sheet, depreciation schedule, payroll information, super contributions, etc.

You’ll also need to get rid of any personal or non-critical expenses to ensure you show as much profit margin as possible. While these expenses are great for minimising tax, they’ll eat into your profit and your buyers will be looking for maximum future profit for them rather than minimal tax for you.

Your broker can also help you create a sales forecast to show prospects their expected return on investment as well as the potential for further growth.

Operational Preparation

Operational Preparation

By the time you list your business for sale it should be operating efficiently and with minimal input from you in order to maximise your sale price. Your business will be far more attractive to potential buyers if you make it easy for them to simply walk into a business that is operationally sound.

Even buyers who will eventually want to put their own stamp on your business will want to be reassured that it will continue to run smoothly once you are out of the picture. So it’s important to incentivise key staff to stay and ensure formal contracts are in place for all your employees.

A broker can help you to communicate that you are going to market with your existing staff, suppliers and customers – it’s vital to get this message right.

If your business relies on operating from a leased premise the lease needs to be current and ideally have options to extend. Make sure any software that is crucial to the operation of the business is current and licensed and your supply chain is well-structured with signed trading agreements with all of your key suppliers.

Physical Preparation

Physical Preparation

If your business is well-organised and presented it will stand out from the competition and reassure buyers that they’re considering a well-managed operation.

First impressions count – in just the same way as you’d get your house in order when you go to market it’s important that your premises, vehicles, staff etc all portray your business at its best. If things need mending or updating, then do it. Make sure your vehicles reflect the quality of your operation and so do your staff. Invest in new uniforms if necessary.

Your website is your “virtual business card” and it’s also usually the first point of contact you have with your prospects, so make sure your website is up to date, and revamp if necessary.

A broker with a marketing background can really make sure your business opportunity is presented to the right target market in the best possible way.

At Brilliant Businesses, we use our digital marketing knowledge and experience to build a “for sale” website for your business. By using the power of storytelling and digital marketing, we pro-actively put your business in front of thousands of potential buyers … we even attract people who are not actively looking to buy a business!

Emotional Preparation

Emotional Preparation

Don’t underestimate the importance of emotional preparation. Selling your business is an emotional and complex process, and the more you prepare, the more in control you will feel.

When you employ a business broker to sell your business it will allow you to clear your head of other distractions and stay focused on your A game – running the business at full strength during the sales process.

After all, buyers want to see you looking keen and invigorated, not tired and jaded!

And when it comes to the selling price, by removing the emotion, your broker can help you to be realistic about the price you can expect, as well as create a plan or goal for after you’ve sold, to ensure a smooth transition out of the business.

Are you ready to sell your business?

Are you ready to sell your business?

Give yourself the very best chance of success by using a business broker to help you prepare properly for your sale.

Our online survey, the Brilliant Businesses Sale Preparation Scorecard, will help you measure just how well prepared you are, by assessing the five key areas of business sale preparation: strategic, financial, operational, physical and emotional preparation.

Once you feel you are sufficiently ready to start a conversation with a business broker, we’d love to hear from you.