To Sell or not to Sell, and when and how, may be very tough questions for an owner. Many will agonize over these and related questions, never find the answers, never reach a real decision and never act, and many businesses, maybe most business, never sell. They just fade away. But, to sell, or not to sell is not a single question, but many. In <-more about these questions-> we discuss many of the questions one should consider.

< - more about these questions - >

Selling the Business ‘Someday’: While most business owners do intend to sell their companies "someday," many, if not most will develop no specific plan to do so; most will have never sold a business before; someday will often be their first and only time and many won't know when or how to begin and how to prepare for this once-in-a-lifetime event. … and, many will not know where to find help that does.

< - more about selling someday - >

Good Timing: Good timing is a key to every step in the selling process, including the decision to sell, and every step thereafter.  … Resist impulses to READY, FIRE, AIM. Just as it may be a once-in-a-lifetime experience, it may also represent a once-in-a-lifetime opportunity. If you are not timely, prepared and strategic with this one last opportunity from this business you've built, you probably won’t take all you should from it.

< - more about good timing - >

Confidentiality: We recommend that you DO NOT float the idea of selling past employees, suppliers, customers, competitors or others in the industry, in any form, and that you do not begin discussions with any prospective buyer until pricing, terms and your selling strategy are fully formulated and prepared, documented and ready for release. Bad things can and often do happen when the wrong people know, or think they know, the company is for sale.

< - more about confidentiality - >

Pre-Selling Preparation: Selling should occur in a deliberate, carefully structured and prepared environment. The sale structure, price and terms should be ready for clear presentation, the relevant facts buyers will be looking for should be compiled for presentation and books and records of the business should be current, complete and ready for diligence. Also, plant and facilities should be clean, organized, uncluttered and prepared to show.

< - more about presale preparation - >

Share Sale or Asset Sale: Is the business incorporated? Is the ‘corporation’ (meaning the shares of the corporation) for sale, or is just the ‘business-operation’ for sale? Is it a Canadian or US business? Will the sale qualify for capital gains tax exemption? What are the respective tax and other advantages to buyer and seller, what will the trade-offs be and how will those trade-offs influence selling price and terms?

< - more about share/asset sale - >

Selling Price/Terms: There is probably nothing more critical to a successful sale than Price. Don’t ask too much or too little, don’t price it as ‘unspecified’ and don’t ask for an offer. The buyer will expect the seller to present a for-sale price, and besides, without substantial confidential information, the buyer won’t know or be in position to make a realistic offer. Pricing should be the first step in the selling process; a step presided over by the seller.

< - more about selling price - >

Disclosure Process: Potential buyers will want to receive quantitative information quickly in order to measure their level of interest, and while the preponderance of information disclosed in the process will pertain to the business-for-sale, the owner/seller will also want assurances as to the legitimate intent and ample capabilities of the buyer. We recommend a progressive reciprocating disclosure process.

< - more about disclosure - >

Third Party Representation: Engaging the services of a third party such as a business broker or agent will often afford real benefit. Representation can bring a buffer of confidentiality to the process, enabling the parties to remain anonymous while the opportunity is being evaluated. A third party may be able to assist with valuation, preparation and presentation, provide a filtering processes, negotiate the offers and generally free the owner to just run the business.

< - more about On-Line Intermediary Services - >
< - more about Seller Representation - >
< - more about Buyer Representation - >
< - more about Self Representation - >

The next section will walk you through the seven unique steps to buying/selling a business.