Selling any property or business can be a stressful process and can create a strain on relationships.
Concerns may be over issues such as wondering how your property is going to sell, how long it will take and what price you are going to get for it. Sellers who are prepared for some difficult times during the process will generally find they can manage it reasonably well.
The following information may assist you in preparing to sell your business by helping you understand the typical sequence of events as they unfold and also to avoid some potential concerns by considering our ‘Tips for Selling’.
Below is a common timeline for the sale of a correctly priced tourism business.
- Preparing financial statements and cosmetic upgrading of property where needed.
- Listing your property for sale: Selecting a broker; signing of agency agreements, preparation of agreed marketing and advertising.
- Broker to prepare advertising campaign and information memorandum for your approval.
- Start advertising and promotion.
- Property inspections.
- Offer and acceptance.
- Exchange of contract.
- Additional due diligence if required.
Tips for selling your Business
Just as with selling any type of property, first impressions count. There are a few practical steps you can take to create a good first impression and increase the perception of value to a prospective purchaser.
- Sort out your financials. A prospective buyer and their accountant will want to inspect the last three years accountants prepared financial year statements for your business. Ensure that corresponding BAS statements are up to date and available as this is the best and quickest way a buyers independent advisor can confirm the performance of what you are selling. It’s pointless going to market with financial information that is eighteen months old or incorrect.
- Sort out your premises. Have a look around with the eyes of a prospective purchaser. What would it look like to a critical new observer? The condition of your premises can say a lot about your profitability. If need be, make cosmetic repairs where required.
- Sort out your debtors and creditors. An area of great concern to a prospective purchaser is the state of your debtors. Based on your figures, the buyer will have to do his cash flow and working capital forecasting to justify the purchase, and may be very nervous about taking on customers who look as though they take forever to pay their accounts. Now is a good time to bring them into line.
- Sort out your stock. It will eliminate any possible arguments over the valuation of such stock during the sale.