Enlisting a Business Broker for Selling or Buying a Business

A business broker understands how complex a business sale can become, and these agents understand the best practices for selling a business. Many long-term business owners sell their businesses because perhaps the person wants to retire or do something completely different; and by hiring a broker, owners can remove guesswork and avoid common mistakes.

Preparing for the Sale

When preparing for the sale, the business owner must generally get financial records for at least the past three years to present to potential buyers, including information on the quality of earnings. The owner must decide whether the company should remain open and if any contract clauses are necessary to protect the current staff. When reviewing different elements of the sale, the owner must make some difficult decisions about the business, and a broker can make these tasks easier for the business owner and thereby lessen the burden on the seller. Business owners who need a business broker can get started by contacting a sale broker right away.

Advertising the Business

A broker understands the best strategies for advertising the business sale to potential investors. Investors are typically looking for new ventures and ways to generate residual income, and an existing business could provide steady cash flow for a new buyer. The brokers will usually list the business on venues where investors look for these new opportunities. The brokers may also have an entire network of investors who are looking for the next big thing or want to assist current business owners get involved in existing business closings.

Including Contract Items

All terms related to the business sale are to be listed in the sales contract, and all items included with the business are itemized in the contract. All responsibilities of each party are defined in the contract including title expenses and closing costs. When setting up the sales contract, the business owner must include all terms that apply to the sale including equipment, fixtures, corporate gifts, and assets that are separate from the company and aren't included in the sale. A review of the terms ensures that each party understands their individual responsibilities.

Shutting Down the Company

If the owner is shutting down the business, this means that the new owner won't get any trademark logos or items connected to the business itself. When a company is set down, all products or inventory are sold to consumers to collect capital for the leftover items. The real estate owned by the company is sold to a new owner along with any equipment the buyer wants to purchase. Once the sale is final, the business owner cannot use the same business name in new ventures.

Maximizing Earning Potential

When selling the business, the broker reviews options for maximizing the owner's return on their investment. Any opportunity during the sale that the owner can maximize the earning potential is significant. No doubt, this can be an extension of previous frugal business decisions such as customer transactions, ecommerce fulfillment, and prior negotiations with a utility bidder. The cost-effective selling of a business may include breaking the company down into pieces instead of selling the organization as a whole, as the process could increase the amount of money the owner gets at the end of all sales.

Business owners choose to sell their companies for one of two reasons primarily. Either the owner is ready to retire and hand over control to someone else, or the owner is ready to shut down the business entirely. A broker can help the owners sell their companies and avoid complications. By hiring a broker, the owners can maximize their return on their investments.