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Where to sell a business quickly
You’ve invested thousands of hours into your business. You’ve worked weekends and evenings, overcome countless staffing and financial challenges, and haven’t taken a holiday in years. Now, whether due to retirement, illness or favourable economic conditions, you’re ready to sell—and you’d like to do it quickly.
Your next question is how and where to sell a business quickly? Let’s take a closer look.
Preparing your business for sale
As a business owner, it’s your job to keep buyer enthusiasm and confidence high, which means being transparent wherever possible.
Information that raises potential red flags, like inaccurate or incomplete financial records, can make buyers suspicious. Some may start applying that sense of suspicion to other aspects of the business, which can jeopardise a speedy sale.
For this reason, getting financial records up to date should be the first step in preparing a business for sale. Smart buyers will examine lodged accounts for tax purposes as well as supporting documentation, and will want to see that the numbers add up.
What does this mean in practice?
You should be able to create multiple points of cross-reference, such as by comparing last year’s lodged financial statement to the corresponding business activity statements and house management records. Can you check your wage records against house management records, weekly rosters and payroll activity reports?
Buyers are more likely to buy businesses with transparent, accurate financial records that can be cross-referenced to within a couple of dollars.
The next step is to take a close look at your staff. Are there difficulties a prospective buyer should know about? Are any staff members on visas, or pregnant? Will any of them need to be replaced after the sale? Disclosing this information early will minimise buyer caution and increase the odds of a quick sale.
Where do you sell a business?
According to industry averages, for every three businesses that go on the market, one will sell. It usually takes between six and twelve months to find the right buyer.
A good business broker with the right networks can speed up the sales cycle. At LINK Business Brokers, for example, half our clients complete the sale within an average time of five months.
We do this by giving the business great exposure in the marketplace, being smart about advertising and using targeted buyer lists. It’s a numbers game—the more people who know your business is for sale, the more inquiries you’ll get.
What slows down a business sale?
Business sales get held up for all kinds of reasons. However, landlords are one of the most common roadblocks. Oftentimes, a sale can’t go ahead until the landlord approves of the new owner.
For a faster sale, the landlord and your solicitors should be prepared to act quickly. The Retail Leases Act gives landlords 28 days to decide whether to assign the lease to the new owner. A good business broker can fast-track this process by helping the buyer prepare all required information. This speeds things along, and gives the landlord fewer reasons to become suspicious of the new owner.
Tips for success
Even if you don’t plan on selling your business immediately, the following recommendations are worth considering:
1. Consider staff as potential buyers – your staff know the business inside and out, and have likely played an important role in its success. What’s more, selling to an employee is generally an easier transaction.
2. Create target lists – Who is your ideal buyer? Identify which type of buyer is most suitable – such as an industry competitor or another party.
3. Work with a business broker – A business broker will help find the right buyers with tools including Hoover and Dun & Bradstreet. They will cold call others in the industry and associated industries and put the opportunity in front of them without disclosing your business name.
Few people look forward to the prospect of their business sitting on the market for a year or more. By focusing on transparency, preparation and working with a good broker, you’ll be on track to sell your business faster.
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