Quick Guide For Business Sellers
Below are details of a "Quick Guide" that business owners may use to prepare their business for sale. ABMI has been helping business owners with these details for almost 30 years. And, on most projects, ABMI works on a straight commission basis, with no advance fees needed. For a free, no- obligation consultation, call ABMI at 913-341-6300, or register with this website.
Step 1- START PLANNING NOW!
- Identify your objectives
- Assemble your team of advisors (CPA, Attorney, Tax Advisor, Estate Planner, Financial Planner and ABMI Business Broker)
- Get your business evaluated; update every year
- Report all income - business value is primarily based on documented cash generated
- Make your role easily replaceable for a new owner.* Document your processes to ease the anxiety of the unknown
- Diversify your customer base if more than twenty-five percent of sales come from one customer
- Prepare financial statements and other business information
- Review the latest business evaluation and understand how operational and financial activities affect the value
- The business is worth what it can produce in current cash flow and future returns to the buyer
Step 3- MARKETING
- Prepare a comprehensive marketing package to present information to qualified buyers
- Use various forms of advertising including local newspaper, Internet, trade publications, and direct mail
- Qualify buyers by asking them questions about their interests, background, income requirements, and resources
- Before providing any detailed information, have them sign a Confidentiality Agreement
- Provide the marketing package and highlight the positives associated with your business
Step 4- NEGOTIATION
- Negotiating could be emotional and uncomfortable -remember that price is only one component of the negotiation
- Other important factors include financing terms and contingencies, which can impact the ultimate value to you
- Communicate offers and counter-offers in writing
- Request an earnest money deposit as a sign of buyer confidence
Step 5- DUE DILIGENCE
- Allow the buyer to review documents and files to verify information you previously provided
- The signed offering agreement should provide the standards for the due diligence process
- Obtaining financing and an acceptable lease are two challenges a buyer typically needs to arrange
Step 6- CLOSING
- Conduct an inventory immediately prior to closing
- Ideally, have a qualified third-party manage the closing process
- Sign all final documents including Settlement Statement, Purchase Agreement, Bill of Sale, Promissory Note and Security Agreement, if applicable; a Notary should be present to notarize all signatures
- Exchange funds. As the seller, you should provide validation that all vendors are paid in full, out of the proceeds you receive from the business buyer
ABMI has been providing all the above services since 1982. And, we've brokered the sale of thousands of different businesses, of all kinds, all sizes, all prices, including managing the entire marketing, closing and due diligence process. Of course, we volunteer to also coordinate all activities with the buyer's and seller's attorneys, accountants and other advisors. And, we perform these services on most transactions on a straight commission basis, and are paid a commission by the business seller at the closing of the transaction. Yes, we accept some assignments on a fee basis, but most engagements are on a commission-only basis.
ABMI's specialty has been helping business owners in Kansas City, throughout Missouri, Kansas and the Midwestern USA. We provide free informaiton on how to sell your Kansas City business, located in either Missouri or Kansas.
To arrange a no-cost, no-obligation appointment to discuss any of these issues, you may phone ABMI at 913-341-6300 or register with this ABMI website.