If you’re a small business owner and you’re getting ready to sell your business, you might feel like you’re in uncharted territory. Selling a business is a complicated process, and it’s easy to make mistakes. What’s more, even a relatively minor misstep could cost you thousands of dollars. So before you proceed, you should be asking yourself: “What steps do I need to take before I list my business?”
At Murphy Business, we have 25+ years of experience selling businesses, and our brokers handle countless small business listings each year. So if you’re wondering what to do before you list your business, we have the answers you need…
“What Should I Do Before I List My Business for Sale?”
Before I list my business, should I hire a valuation service?
Yes, you absolutely should! A professional valuation will be critical to protect your financial and business interests. Without one, you could undervalue your business, causing you to lose value on the transactions. Or you could overvalue your business, causing the listing to stagnate and could affect the final purchase price.
What can I do before I list my business to improve its value?
There are several steps you can take to boost value before you list your business. For example, let’s say you’re involved in every aspect of your business. In this case, the value of your business depends largely on you. That value disappears once you’re gone. So if you want to boost the value of your business, you’ll need to scale back your involvement.
Should I hire a business broker to list my business for sale?
Hiring a business broker is one of the smartest decisions you can make before you list your business. An experienced business broker can walk you through every step of the listing process, provide expert advice on how to maximize the value of your business, and connect you with specialists to help with other aspects of the sale.
“How Should I Go About Listing My Business?”
What information should I include when I list my business?
When you’re listing a business, you need to think carefully about the information that you’re including. On the one hand, you want to maintain confidentiality, so you don’t want to include identifying information. On the other hand, if you list your business without including important information, you’ll struggle to attract buyers. If you’re unsure what kind of information to include, a professional business broker can help you build a saleable listing.
What information should I NOT include when I list my business?
As noted above, it’s important that you don’t include any information that makes it easy to identify your business. This information should be presented in a detailed, confidential selling document. This document should only be made available after a prospective buyer signs a confidentiality agreement.
Where is the best place to list my business for purchase?
If you’re unsure where to list your business, this is yet another reason to hire a business broker. As an independent seller, you may not be able to access key listing networks, some of which are only available to brokers. Other networks charge expensive fees for listings, which makes it difficult for independent sellers to market their listing.
“What Should I Do After I List My Business?”
After I list my business, should I run it any differently?
Many business owners make the mistake of changing the way they do business after putting their company up for sale. Usually, this is unintentional — the owner knows they’re selling, so they become less invested in the business. The business then starts to underperform, which causes its market value to plummet. In almost every case, you’ll want to continue running your business in the same way after listing.
How should I handle offers after I list my business?
Without professional advice and support, it’s easy to make missteps when handling offers for your business. For example, many sellers jump at the first offer they receive, when it’s usually better to wait and get a sense of how the market values your business. At the same time, it’s important that you qualify any potential buyer before proceeding with negotiations. If you don’t, you could waste valuable time and resources pursuing an offer that won’t go through. Worse yet, you could lose out on properly qualified offers during this process.
Who will handle the regulatory, legal, and financial details of the sale?
If you hire an experienced business broker, you shouldn’t be worried about the finer details of your sale. Successful and respected brokers will use a proven process to make sure these details are handled correctly. In addition to a business broker, you’ll want to make sure that you have a financial advisor and an attorney who specializes in business agreements. If you’re unsure who to hire for either of these roles, a good broker can provide referrals for local specialists.
“And One More Question…”
Who do I contact if I want to list my business with a Murphy Business Broker?
To list your business with a Murphy Business Broker, simply call (888) 561-3243. Our brokers can help you maximize the market value of your business, reach an extensive pool of qualified buyers, and navigate the negotiation process.