Selling Your Business
Updated: 7th July 2008 (PM)
Sterling Business Sales is a new division of our group, specialising solely on sales of family businesses. Further information can be viewed at http://www.sterlingbusinesssales.co.uk>
Sterling Capital Reserve can guide you through the sale of your business, helping you decide the timing of the sale, finding potential purchasers, preparing the business for sale and negotiating terms on your behalf to ensure you get the best deal.
The sale of any business is time consuming and stressful, and it is advisable to seek professional guidance at the outset.
Sterling Capital Reserve can guide you through the sales process, helping you decide the timing of the sale, finding potential purchasers, preparing the business for sale and negotiating terms on your behalf to ensure you get the best deal.
The Value of Your Business
Factors affecting the value of your business:
- Timing of the sale
- Condition of the business
- The particular interests of the buyer
Selling the business when there is a new set of audited accounts available reduces uncertainty over the trading position and the assets being sold.
Preparing Your Business for Sale
The earlier you start preparing to sell your business, the better your chances of success will be.
Sterling Capital Reserve can help with this process, identifying any areas of the business that require improvement, which any potential purchaser would otherwise use during negotiations to drive the price down.
By presenting the business in a favourable light and preparing solid forecasts and strategies to show purchasers the future potential of the business, we work towards securing the best deal for your business.
It is important throughout the process to continue operating the business as if you were going to continue in ownership.
Building a strong management team that reduces the business? reliance on you can greatly enhance the value of your business to any purchaser, as their risk is reduced, since you are not critical to the company.
Ensuring the management team and staff are happy and motivated, can assist with a smooth transfer of the business.
Project Management
As professional advisors, Sterling Capital Reserve can take the stress out of selling your business by managing the sale on your behalf.
When we receive an initial enquiry we are able to assess the potential purchaser to eliminate time wasters and to establish whether they can actually afford the business. We are then able to negotiate with interested parties, attend meetings and ensure that you get the best deal.
Once a sale has been agreed and solicitors appointed, we liaise with all parties to keep within deadlines and to promptly address any issues that arise.
Preparing a Sales Memorandum
The Sales Memorandum is used to attract potential buyers, and both its content and presentation are of the utmost importance to illicit interest in your business.
The document will provide basic information about the industry you are in, key financial information (turnover, profit, value of assets), location of premises and staff.
It is essential to draw out and emphasise the strengths of the business, highlighting any opportunities for growth or increased profits. Areas for improvement should also be addressed at this stage to prevent any problems later on. An honest and open approach will gain the trust of any potential buyer and assist the sales process.
Anything misleading in the sales memorandum will lose the buyer?s trust and interest, and will ultimately affect the price they are willing to pay.
Sterling Capital Reserve can prepare a concise and informative sales memorandum on your behalf, highlighting the full potential of your business and encouraging further interest from suitable buyers.
Finding a Buyer
You will no doubt have views on potential buyers you want to include and exclude from the marketing process, so we work together with you to draw up a list of possible buyers, which may be either trade buyers or even new entrants to the industry sector.
We draw upon your knowledge of the market, and any prospective buyers you may have already identified, as well as targeting potential purchasers held on our own corporate finance database. Our knowledge of acquisitive parties along with many contacts in the corporate finance community also allows us to identify ?non trade? buyers or private individuals that may be looking to enter the market.
Confidentiality
Maintaining confidentiality is crucial to a successful sale. Once a prospective buyer expresses an interest we require them to sign a confidentiality agreement (which prevents them discussing the sale with any third party) before providing any further information.
Information is restricted throughout the process, and your business name is not divulged until there is a serious buyer in the frame.
Taxation Issues
Sterling Capital Reserve can assist in determining the most tax efficient method and timing of selling your business. Capital Gains Tax is a major consideration, and general tax planning can assist in negotiations and allows you to work toward a specific outcome.
We can only help you, if you contact us!
Contact Us Online - or call 0115 984 9800.
