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So, you have decided that the time has come to sell your business? There are many different reasons why people reach this decision. For some, they want to pursue a different path or concentrate on their family. For others, the passion they once had has gone. There are then those that need to shut up shop for financial reasons. No matter what applies, you need to make sure you approach the sale in the correct manner. With that being said, read on to discover some of the key mistakes you need to avoid when selling your company.
No confidentiality agreements – This is one of the biggest mistakes any business owner can make when they are looking to sell. Signing confidentiality agreements is a necessary precaution. When selling any type of company, due diligence is of paramount importance. Competitors may be able to obtain private information about your business if you do not have the right agreements in place, and this could severely jeopardise any chance of you selling your business at a good price.
No valuation strategy – A lot of business owners make the mistake of valuing their business too high because they are so invested in it. When it comes to valuations, you need to adopt the right strategy. You can learn about the different options available to you here: http://gosmallbiz.com/4-business-valuation-strategies/. You are going to need to provide evidence of your valuation, for example, depreciable assets, gross profit, turnover and such like.
No investing in thorough due diligence – Aside from the points that have already been mentioned, another critical piece of the puzzle is to invest in thorough due diligence. This will ensure that you can pinpoint specific improvement areas and other parts of your company that you may have overlooked. This involves putting together a report of your existing financial profile, as well as your growth potential.
Failing to seek the correct help – Selling your business is a mammoth and complex task, and not something that you should handle on your own. However, when it comes to seeking assistance, it is all about choosing the right kind of help. You need a company that has experience when it comes to selling businesses of your size and in your industry. You can find out more about this at Afhwm.co.uk. After all, if you run a financial advisory firm, you are going to be targeting a completely different market to someone that is selling their retail business.
As you can see, there is a lot to consider when it comes to selling any type of business. Nevertheless, if you can handle the process correctly and avoid these mistakes, you can give yourself the best chance of ensuring everything goes to plan and that you sell your business quickly and at the right price.