Our experienced brokers guide you through our proven nine key steps.
Preparing to sell your business by maximizing its efficiency, earning potential, structure and presentation really pays off. For example, minimizing costs and increasing annual profit by as little as $5,000 could add $20,000 to the sale price. We can help you recast your profit and loss (P&L) to determine your true SDE (Seller’s discretionary earnings).
02 Broker’s Opinion of Value
Naturally you want the maximum price for your business. But setting and asking price too high could scare away potential buyers. While pricing too low means less financial reward for your hard work, there are many ways to value a business. Using a combination of these will usually provide the most realistic price band. The methodology must be accurate and appropriate for your type of business and stand up to expert scrutiny. Every business is unique, making it vital to deal with people who have proven experience in establishing true market value.
An Information memorandum (IM) is a comprehensive document that gives a detailed overview of the business. It must be crafted to ensure it is accurate and represents your business honestly, while adhering to numerous legal requirements and regulations. This includes disclosing anything that may harm the ongoing profitability.
04 Identifying Buyers
It takes more than setting the right price to find your ideal buyer. Having access to a large database of qualified buyers in your sector means greater competition and a better sale price. As independent professionals, ZBB brokers can discreetly approach buyers we believe might be interested, without divulging information.
Zoom Business Brokers has one of the most experienced group of business brokers in Southern California. Through decades of experience and measurement of our experienced brokers we know how to create effective marketing campaigns. Ads, brochures, web, social media and other communications are carefully planned and executed to attract buyers without identifying your business.
06 Finding “Real” Buyers
We know that not every inquiry about a business for sale is from a genuine potential buyer. But screening every buyer is often a surprisingly time consuming and difficult process. Actin as an independent third party, ZBB brokers can maintain confidentiality until all potential buyers have been checked for buying capacity – education, experience and finance.
07 Purchase Agreement
After a potential buyer has reviewed the information Memorandum and expressed interest, they’ll have more questions and will usually ask for further information or documents. A ZBB broker co-ordinates this process, by liaising with the business owner or their financial/legal terms to negotiate a conditional Purchase Agreement without yet supplying sensitive details.
08 Disclosure and Due Diligence
Signing the Purchase Agreement doesn’t necessarily mean the business is sold. Most buyers will want to verify your information during a due diligence period. They’ll also need to review information previously witheheko due to commercial sensitivity. This process generally takes 5 to 5 working days, although for more complex businesses, it can be up to 90 days or more.
09 Conditions Removal and Closing
Once all the agreement conditions have been satisfied, the Conditions Removals ar signed, and escrow will be opened. Escrow is a means, time period and trust arrangement during which the paperwork required for the sale of a business is processed. Escrow acts as a “neutral” agent of seller, buyer and broker to collect documents, money and to distribute the same according to escrow instructions as directed by the principals.
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