Avoid These 5 Mistakes While Selling Your Business

William is an entrepreneur and after 5 years of hard work and capital investment he had been able to build a business that generated pretty good revenue for 2 years but now it is on the verge of closing down.

So after much thought, William has decided to sell the business in order to obtain the best possible value for his business. He did a bit of research, posted a sale advertisement on social media and within 2 days got a buyer, who according to him gave a good price for his business.

His notion of having got a good deal was broken when he met one of his old college friends Mark, who happened to be a business broker in Melbourne in a reputed company.

When William told him about the business deal that he had recently closed, James was shocked. William actually sold his company at a loss. Being at the prime location with all company assets not older than 5-6 years, he did not get a good value of his business. 

William had made these 5 mistakes. Read further and learn.

Planning is the key to success in every form of business. The same goes with selling. It takes a couple of years to sell a business like 3-4 years. In this time, the person intending to sell a business must be prepared and as a result must keep all the business records updated and should have entire business history and sales portfolio on hand so that whenever that perfect buyer comes to you with that perfect deal, you are ready to grab the opportunity.

Selling a business is not a cakewalk. It needs a great level of preparation from a presentation point of view. You may know everything about your business but a professional business broker will know how to present your company in the most appealing way by highlighting the merits of your business and diminishing its flaws. Drafting a clear NDA, an accurate CIM document and concise and clear business contracts need experience, expertise and profound knowledge of buyer’s mentality. Based on this, a broker will try to crack the deal in a way that is beneficial to both parties. And when you fail to hire the right business broker for your business for sale in Melbourne, you may fail to succeed.

Let’s say you are wise enough to hire a professional for selling your business. Now they would do everything that is required to market your business sale in the correct place and among the right community of buyers for attracting them. However, you cannot relax at this point by outsourcing the marketing responsibility solely to the broker firm. Since nobody can know your business better than you, it is still recommended to promote the features of your business yourself. The kind of passion and knowledge that you can impart to the marketing strategy of your business, nobody else can. So always have a say in the matters of your business marketing.

Whatever may be the reason for selling your business, it sales process must never be carried out with desperation. Because this will result in you either underestimating or overestimating the overall worth of your company. Hence, always approach an expert in the field i.e. a business broker in Melbourne and have your business evaluated by them. You may possess the required market knowledge but their wealth of experience in selling businesses will be far more than yours. Based on this information, they would know the past, present and current market status of your business and accordingly will be able to find an appropriate buyer faster than you can.

It is of utmost importance that the confidentiality of the news that you are going to sell the business must be kept at all cost until the final deal is closed and new management comes in. This step will help you save your company from falling apart before the sale due to the possible chaos that may erupt among your employees for their job security, your suppliers and other dealers for their loss if they continue to conduct business with you and your hard-earned loyal customers base for not getting same services and products in future. They all will turn their backs and look for other potential business opportunities. Contact a business broker in Melbourne for more information on this.

Business brokers charge a commission of about 7-10% of the total sale price of your business. The amount may be exorbitant but when you look from a business perspective, the amount is worth the amount of hard work they put into getting that perfect buyer for your company who can offer the best possible price for it. Preparing promotional plans, presenting the business to correct people and at the right time to get maximum leads. Drafting NDA and CIMs tactfully and professionally to present your business in the best possible way. Showing the buyers around, explaining each and every bit of your business for sale in Melbourne to every genuine buyer. Negotiating prices and striking the best deal they could get you. All this could be too overwhelming and hectic for a non-professional. But hiring a business broker can help you sail this boat smoothly. You will save a lot of your time and energy that will be of more worth than 10% of the broker’s commission.

Do not follow the “ first come first serve” philosophy here in selling business. The first buyer you meet may not be the right person to buy your business and run it. After all the years of running your business successfully with hard work and dedication, you would not want it to go into the wrong hands. So proper research must be done and professional advice must be sought in order to find a genuine buyer and finalize the deal with them.

Everything that glitters is not gold. Learn this saying by heart and keep repeating it while screening for potential buyers. Do research, hire a professional business broker in Melbourne and do not settle for anything less than the actual worth of your company. After all, it’s your business that you have built with your sweat and blood.