10 Crucial Exit Strategies Leading to a Successful Sale of Your Business
Five years after helping a client to sell his business, I received my final check and placed a call to the person who represented the buyer. In discussing the history of the transaction and tying up loose ends, we came to the conclusion that a sale isn’t complete until you have survived the negotiations and the closing, cashed the final check, confirmed that the statute of limitations has run out for all contingencies and verified that the new owner(s) are happily making money.
Good deals don’t just happen. They take preparation and work. Often a great deal of work and years of preparation are consumed before a sale can even be contemplated. Forging the transaction, itself, may take anywhere from four months to two years, and the payout, unless you sell at a discount, can easily be another five years. Good succession planning, and the development of viable exit strategies, are key to crafting the best deals.
No plan, no profit. What happens when there are no exit strategies?
Business Background Check – It Pays to Know Someone Else’s Business
So what is business background check really all about? The following report includes some fascinating information you can use, not just the old stuff they used to tell you.
You’ve got work to do and have to hire a business to do it. Whether it is a contractor to work on home improvement projects or you plan to build a swimming pool, you want to make sure you pick the right business to do the job for you. That is why a business background check will help you in your decision. You can find out if the company you are dealing with is a fly-by-night type of operation or a company with integrity.
If you have got the time and patience, you can perform your own research. The internet holds all sorts of information, just waiting to be discovered. However, you have to know where to look. The most common place to start is your local Better Business Bureau, especially if it is a locally owned business. The Better Business Bureau can help you verify the company’s address and company officers. As part of your business background check, they can also tell you if there have been complaints against the company and if the issues were resolved or not.
Another step is typing a simple search in an internet search engine. You can find any mention of the company you want to do business with, from their accomplishments to financial information. If you have the company’s Federal Employer Identification Number (FEIN), you can find out much more in your quest for a business background check. For instance, that number could be run through the Secretary of State website and you can find out about the company’s officers, financial information and incorporation information. You can find out if the company had done business under another name too.
Business Brokers
Business brokers help you in the sale and purchase of businesses. They charge fees for providing brokerage services. The fees depend on the size of the business, the final sale and the purchase price. There are different business brokers for dealing with different kind of businesses. For example, some of them might specialize in mergers, and others in acquisitions. Apart from the fixed fee, most of the brokers also charge commissions. The commission can be computed on the basis of the selling or purchase price of the business. The larger the price, the greater the leverage to negotiate commission rates with a business broker.
If you have sold your business or purchased a new one you might feel you don’t need the help of a business broker, especially if you know the prospective seller or buyer well. But if you are entering a new industry, buying or selling a big business, or do not know the buyer or seller you are dealing with, then a business broker can be of great help. Business brokers not only help in negotiating and taking one through the complete transaction, but they have a wide range of contacts. They could find you a better deal through these contacts.