Let’s assume you and your firm have been successfully selling office products for nine or ten years and you’re thinking about selling the business since you keep receiving so many attractive offers for it. How should you and your partners go about setting a fair price – one that will properly provide you with a significant profit based upon everyone's hard work?
Take time to review each of the following factors that should provide you with the proper facts to back-up your request.
What Aspects of Your Business Are Making It So Successful/Who Are Your Optimal Buyers?
Make a list of all of your current clients who’ve been with you for many years. Clearly indicate the annual profits often generated by these transactions. Also, indicate why this past history indicates that they are each likely to stay with you well into the future;
Create a clear record of all of your current business assets. In addition to any inventory, you may want to reference all of the highly experienced workers who've been with you for many years. Also, carefully note if you hold any special design patents or other similar goods that help keep your competitors at bay;
Write down the various ways other companies in your industry usually arrive at proper valuations for their businesses. Be sure to document any claim that your firm offers special value and stability to customers (when truly justified);
Be ready to describe the best type of buyer for your business. Are there specific assets that they will need to have during the start-up phase? This type of information can help you avoid losing a good potential buyer;
Indicate how soon you hope to complete the sale. However, avoid indicating whether you or your partners are in any type of difficult financial straits since this can obviously work against you during negotiations;
What terms of sale or payment do you either prefer or require? Are you willing to be flexible to some extent? If not, state your firm's demands that must be fully met before a sale can go forward;
Always be sure to provide appraisal documents that back-up all of your valuation claims. Give serious thought to whether you'll allow a serious potential buyer to bring in his/her appraiser to review all of the assigned values you’ve shared.
Once you and your partners (or other firm members) have gathered together all of this important information, be sure to discuss the most advantageous way to present it to potential buyers. You may want to ask your Peachtree City business attorney to review your request, while making sure you stay open to any constructive criticism.
If you’ll bear in mind that “flexibility” is usually the key to many successful sales, you should do fine.
To obtain help with handling all of your Georgia business planning needs, please contact the Law Offices of Shane Smith today. You can schedule your free initial consultation with a knowledgeable Peachtree City estate planning attorney by calling: (770) 487-8999.