Buying and Selling a Business
SELLING AND BUYING A BUSINESS
Why?
The first issue is always “why?” Why does the owner wish to sell, why does he/she wish to sell now? It’s possible that the owner would like to keep the business, but believes a sale is necessary. Is the owner “jumping the gun” on the sale, perhaps due to bad information? Financial and tax laws change frequently; and what would be beneficial this month might bring a penalty next.
The same applies to the buyer. Why does the buyer wish to acquire the business? Does he want more capacity? If the business produces goods, does he need extra capacity going forward permanently or for only a defined period to win a contract? Is he seeking to gain the clients with the purchase? Is he proposing an asset sale in order to acquire a specific client or group of clients? There are cases where contracts do not convey with a sale of assets. Buyers seldom act on emotion. No matter how devoted you are to your chewing gum museum and dental clinic, you cannot reasonably expect else to let sentiment affect business decisions.
Three Ways to Sell
There are basically three ways to go about selling your business. One is to sell it yourself, perhaps having identified a likely buyer to whom your business will appeal. If both of you are enthusiastic, agree about the relevant facts, and there are no secrets being kept, then a miracle has happened, and you’ve sold your business. More likely, you’ll post your business on a number of public boards, such as www.bizbuysell.com.
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