| An event is defined as something that happens or | | | | have drawn more money from the business |
| is regarded as happening. It is the outcome or | | | | earlier into a tax deferred account? |
| result of something. Its occurrence is localized at a | | | | The process starts with strategic planning and |
| single point in time. | | | | continues through to the sale. The sales stage |
| The sale of your business does not just happen | | | | might be the final step in the process, but it too is |
| and it does not just occur. It is the result of a | | | | a process. |
| process. The sales process alone takes 6 months | | | | The sales process looks like this: |
| to a year and the planning process could take | | | | The business first must be valued to |
| years before that!! | | | | determine a reasonable selling price. An asking |
| One of the biggest misconceptions about selling a | | | | price not supported by the assets and cash flow |
| small business is that it is an asset that can be | | | | available for sale will result in the business sitting |
| easily converted to cash. Not only is converting a | | | | on the market and rotting. |
| business to cash difficult, it may not even be | | | | Marketing packages must be prepared to |
| possible. Consider the following scenarios: | | | | confidentially market the business for sale to |
| The business owner IS the business. The | | | | prospective buyers. |
| owner holds all the relationships with customers, | | | | Buyers? How will they be located? How will |
| vendors, and employees and cannot be easily | | | | they be approached? A qualified business broker |
| replaced. In this situation not only would a buyer | | | | or intermediary is a great starting point but there |
| severely discount the price, they might not buy at | | | | is not a ready and active market for your |
| all. | | | | business to be sold. You cannot go online and click |
| The business is not cash positive. If the | | | | a button to sell your shares. It must be created |
| business is not set-up to show positive cash flow | | | | from scratch. |
| it will have a low probability of selling. Buyers do | | | | Once a buyer is found there will be an |
| not want to buy your "stuff". Your assets don't | | | | exchange of information and several rounds of |
| pay their bills and send their kids to college, your | | | | negotiations before a deal is reached and a |
| cash flow does. | | | | transaction finalized. |
| The seller's expectations of sale are not in line | | | | All this takes time. Engage qualified professionals |
| with reality. What if you're ready to retire and | | | | to help you plan for a sale well in advance of the |
| you suddenly find out the nest egg for your | | | | sale itself. It's a process. It takes time. START |
| retirement is worth half of what you expected. | | | | NOW! |
| Would you have planned differently? Would you | | | | |