A business sale is a one-off opportunity to crystallise the value that owners have invested over the years, often a generation. It is critical to get it right.
Sales opportunities come from all directions. Some owners may have always had a disposal in mind. For others, shifting personal circumstances or an unexpected offer has edged them closer to a deal. Whatever the impetus, those that have taken steps to prepare will reap the biggest rewards.
Early planning significantly increases the chances of a successful outcome. Trying to address concerns once the sales process is in motion is a high-risk move. Nervous buyers will quickly undermine the sale price, withhold cash on exit or walk away from the deal altogether.
It can take many years to get businesses in the right shape to maximise exit value. Preparation puts the seller in a strong position to negotiate a favourable price. It helps ensure a smooth sales process and ultimately increase the chances of business success following a change in ownership.
In the years ahead of sale, owners should start thinking like an outsider, identifying and addressing key risk areas. They should evidence momentum in the business and take steps to ensure the eventual transaction is as tax efficient as possible. Without this, many will struggle to fully crystallise the value they’ve worked so hard to achieve.