How Do I Sell My Business?

Selling a business involves more than just finding a buyer; it requires careful planning, thoughtful preparation, and guidance through both financial and personal considerations. Drawing upon more than 70 years of experience, our team is equipped with the knowledge and tools to guide you every step of the way.

Before beginning the selling process, many business owners have questions and concerns that go beyond the financial transaction. They wonder if they can afford to sell, how the sale will impact family, friends, and customers, and whether the buyer will continue the level of service that they’ve worked hard to establish. At Chapman Associates, we recognize that selling a business is about more than just a deal; it’s about protecting your legacy and ensuring the future of your company, employees, and reputation.

12 Tips On Selling Your Business

Chapman Associates has been providing expert guidance to owners of mid-sized companies for over seven decades. The insights and tips we’ve assembled here are important as you consider putting your company on the market. Focusing on these details has helped us sell over 2,400 companies worth billions of dollars.

1. Establish your ultimate goals.

Spend time thinking about the reasons you are considering selling your company. If your goals are primarily financial, i.e., “cashing in” on your years of hard work, converting your company into liquid assets for your retirement, or providing for your family’s financial well-being, remember that the timing of a sale may be critical. It’s a good idea to get a professional assessment of current marketing conditions before you make a decision.

2. Create a market for your company.

Your objective should be to deal with as many potential buyers as possible at the same time. An experienced M&A professional should be able to introduce you to several interested buyers simultaneously. If so, your leverage, as well as your ultimate selling price, will increase dramatically.

3. Stay focused on your business.

Stay focused on operating your business. Don’t let the sale of your business impact the company’s financial performance. A sudden drop in sales or net income can negatively impact the value of your company once a buyer is found.

4. Be realistic.

Remember that most buyers will ignore a company that is overpriced. Your negotiating position is significantly weakened if you go back to a buyer and explain that your company is now “on sale.”

5. Remain flexible.

There is more than one way to structure a successful sale. Be ready to consider all offers. An experienced professional can help you analyze each offer on its own merits and choose the one that is best for you.

6. Keep the sale of your company a secret.

Don’t let your competitors or business associates know your company is for sale. This minimizes the risk that competitors will raid your key employees or customer base. Most importantly, use an intermediary skilled at arranging confidential transactions to avoid any possible leaks.

7. Reveal everything up front.

Nothing can derail negotiations faster than unexpected surprises. If buyers aren't scared off by surprises, they will certainly reduce their offer as a result. With up-front disclosure, your M&A professional can help you package negative information more effectively, reducing its impact on the company’s market value.

8. Retain an expert to help you with the sale.

Selling your business will probably be the biggest and most important decision you’ll ever make. Don’t underestimate how complex and emotional the process can become. A professional can be objective, help you analyze your options, act as a buffer between the parties, and be a problem solver if the parties reach an impasse.

9. Consider the first offer very carefully.

Each offer should be considered on its own merits. Remember, the first offer is no better or worse than the last offer just because it's the first. Your M&A professional can give you a hand deciding which offer is “right.”

10. List your company on an exclusive basis.

Select one experienced M&A professional with whom you feel comfortable – one that clearly believes in you and your company. By giving them an exclusive listing, you ensure that they have the proper incentive to market your company and represent you aggressively.

11. Screen buyers carefully.

Remember that many people claim they’re buyers when they aren’t. Only buyers who put their offers in writing and are willing to back them up with earnest money are worth your consideration.

12. Trust your gut.

Trust the business judgment you used to build your business in the first place. Rely on your lawyer, accountant, and M&A professional for advice, but at the end of the day, make the decisions that feel right to you.