Every business owner should know how to sell a business fast. Selling a small business is extremely difficult. Small Business is not started or managed for a sale to a new owner. Its primary purpose is the benefit of the owner. As a consequence, much of the operation is a reflection of the owner. Much of which may not be documented. This is particularly true when it comes to financial reporting. It is in the owner’s interest to overstate expenses and under-report earnings to pay less in taxes. This makes it difficult or impossible for a buyer to have financial statements showing the actual earnings of the business.

 

Companies Must Be Sold In Secret

Most products or services sold are advertised, so the maximum number of people know about the sale, but companies are sold in secrecy. Companies are sold secretly, so customers, employees, and vendors are unaware of the pending sale. Customers, employees, and vendors could be lost if word gets out before the transfer of the company. 

 

What Makes Selling a Business Hard

It is more difficult to sell a business if the financial records are incomplete or don’t accurately represent the profits and financial performance of the company. This can be due to various factors, from lack of financial reporting to using accepted tax strategies that reduce income to reduce tax liabilities. No two businesses are alike, requiring a buyer to understand the value of a business under their ownership.

 

Companies are founded for the owner’s benefit, with little thought given to the prospects of a future sale. Buyers of small businesses and business owners have opposite goals in transferring the business. The most obvious difference is that business owners want to sell at the maximum price, and buyers want to pay the least. While the price is critical to any deal, it is also crucial that all parties get enough of what they want, or there will be no deal.  To sell a business fast, the following things need to be in place:

 

What Needs to Be in Place to Sell a Business Fast

Realistic Price – A professional valuation should be done to express the actual value in the asking price.

Financial Records – Tax returns, income statements, balance sheets, equipment lists, payroll, and associated documents must be available for buyer review. This is usually shared during the due diligence period. Sensitive information regarding the company is only shared after a non-disclosure document has been signed.

Operations – The business’s operations should be documented so the buyer knows what to do after selling the company. Hours of operation, job descriptions, and quality control are some things that need to be documented for the new owner.

Marketing/Sales – There needs to be a process that allows the business to maintain the current customers and get new ones that can go on after the company is sold.

Agreements – Leases and trade accounts must be transferred or new ones established so the business can continue functioning. This should be itemized to include terms, pricing, expirations, etc…

Transition Period – Training and transition should be agreed on so the new owner can learn the operation and continue after the sale. Buyers acquire going concerns because they want to start with a history they hope to build on.

Market The Company For Sale – The business needs to be marketed to the largest possible audience, including industry insiders, the internet, social media, and outreach to likely buyers.

 

Why Businesses Don’t Sell

80% of businesses don’t sell because the items mentioned above are unavailable for buyers. Everything must be put in place to sell a business fast before attempting to sell. The most significant factor in selling a business fast is ” showing them the money.” Financial statements must show the buyer how much money they will make if they buy your company. Honesty and transparency are what get businesses sold fast! Selling a business fast requires slowing down to do the proper preparation first.  Click the link below to schedule a free, no-obligation call to discuss how to sell your business fast in today’s market.