1. What is Involved in Selling My Business?

A business sale can take 6 months to 2 years depending on the situation. Our brokers will work with you to evaluate your situation and determine the most likely outcome when listing your business. The entire process has several phases.
Business Sale phases include:
1. Preparing for sale and providing information to the broker
2. Determining valuation
3. Marketing of the business for sale
4. Collecting buyer responses
5. Qualifying buyers
6. Working with buyers to get an offer
7. Buyer puts together LOI (letter of intent)
8. Both sides discuss the LOI
9. Buyer may put together the final purchase agreement or request due diligence
10.Buyer performs due diligence
11. Buyer finishes due diligence and approves of buying business
12. If bank financing is involved, buyer will provide docs to bank for approval
13. Financing approved bank (if appropriate)
14. Sale goes to escrow
15. Seller involved in transition of the business to the buyer

The transition period after the sale can be 1 month to several years depending
on the complexity of the sale and what terms were negotiated between the buyer and seller.

2. How Do You Arrive at the Commission You Charge for Your Service?

Commission rates in the industry are fairly standard throughout the United States. What is not standard is the level of service and professionalism provided by business brokers and intermediaries. Because we invest signifiant time and money into a listing before receiving offers we may charge an engagement fee (marketing fee) in addition to the commission on the completed sale of the business. We also offer a decreasing scale commission for the sellers of large businesses.

3. What Should I Expect for the Commission I Pay the Broker?

The broker works with the seller in establishing a price for the business. After an agreement on price is reached, the broker creates a marketing strategy to maximize the listing price.
As business brokers, we are knowledgeable and skilled negotiators working on the seller’s behalf. Our approach is to interview, screen, and qualify prospective buyers before they meet with a client of ours.
We invest significant time and money upfront to market a business to ensure a successful transaction. Our marketing approach for a listing can vary depending on the situation but may include reaching out to contacts in our network, advertising on the Internet, advertising with direct mail, seeking out others in our network of brokers and industry experts, using trade publications, newspapers and other sources to promote a business listing.
We will show a business only to qualified buyers, allowing the seller to run his business. If the prospective buyer has questions or wants to meet with the seller, we will arrange a time that’s convenient, and we may attend meetings.
We work with the seller’s outside advisors to help make sure the sale progresses smoothly. We may assist the buyer by providing sample forms for due diligence, letters of intent and purchase agreements in addition to offering highly reliable sources for funding the purchase.

4. What is Your Expertise in Determining a Fair Market Value?

We offer a free business valuation regardless of whether you decide to do business with us. We have access to a proprietary database of sold businesses throughout the United States. This database tells us what the true market is for a business. We use this database along with various other sources to help determine a fair offering price for your business.

5. How Do You Prepare a Financial Comparison and Cash Flow Analysis?

With the data that you provide from your financial statements and tax returns we put together a comparison of your business along with a cash flow statement that becomes part of the prospectus for your business.

6. What Promotional Material Do You Give the Buyer?

With information you provide about your business, we put together a Prospectus or Businesss Summary which is a document that tells a prospective buyer some particular information about your business. Information such as how long in business, how long at current location, number of employees, lease particulars, type of equipment included in sale, number of active clients, types of services provided, business referred out, days and hours of operation, comparative financial statement and cash flow statement are all included. This information however is only provided to qualified buyers who have signed a Confidentiality Agreement.

7. How Do You Market my Business?

We use a comprehensive approach to market your business. We start with our list of potential buyers. We sort the database to locate buyers who wish to buy in that particular location. We also utilize various web sites and publications with general information regarding the listing. In addition, we may promote your listing in our regular newsletters that go out to several thousand business owners and prospective buyers.

8. Do You Attend Meetings Between the Buyer and Seller?

We may attend some of the in-person meetings between the potential buyer and seller. This is important as there is information that should be exchanged between the potential buyer and seller at these meetings such as how the business is operated, specifics about services offered and referred out, etc. The initial meetings between buyers and the seller are not meant to discuss or negotiate the price of the business. We are very skilled at conducting these meetings and making sure they are productive for both the prospective buyer and seller.

9. How Do I Negotiate Offers From Buyers?

This is a very delicate matter and we are very experienced in dealing with a buyer that has made an offer. We manage the process so that both the buyer and seller feel satisfied with what they acheived in the transaction. The buyer needs to feel that he is getting a fair deal in the process and we are sensitive to the needs of all parties in these types of negotiations.

10. How Is the Sale Handled Once I Have an Offer?

Once a verbal offer has been accepted the buyer needs to put together a Letter of Intent or Purchase Agreement for the purchase of the business. This gives the seller some comfort in knowing he is dealing with a serious buyer and lets the buyer know we are committed to the sale of the business.

11. How Do I Assign a Value To My Various Business Assets?

The Purchase Agreement will specify how to allocate the purchase price to fixed assets, goodwill, non-compete agreement and a consulting agreement. There are advantages and disadvantages to how the purchase price is allocated to each category depending on whether you are the buyer or the seller and your specific tax position.

12. Do You Offer Accounting and Tax Advice?

We have a network of service providers that we can recommend should you need any accounting or tax advice related to this transaction. These providers have been screened to ensure they are among the best in their field at what they do.

13. Do You Offer Financing?

In today’s environment it may be necessary for the seller to offer financing to make a deal work. Should the buyer need financing, we offer financing through several lenders that we work with but each listing is unique and will dictact what financing is available through outside sources. We recommend that the buyer is qualified for financing before you accept a Purchase Agreement.

14. Will You Review My Documents?

We review each and every version of the Purchase Agreement along the way. We offer our advice to you and your attorney about what should and should not be included in these contracts. We also are involved in helping iron out any sticky issues between the parties that may arise in negotiating this agreement.

15. When Can I Reach You?

Questions, issues, negotiations, emails and phone calls do not always fit neatly into an 8-hour day, Monday thru Friday. We are available to our clients during business hours and by appointment on week nights or weekends. We respond to our emails or phone calls within 48 hours of receipt but most likely will respond within the same business day.

16. What If the Deal Falls Apart?

Sometimes, negotiations get tense and there is a potential for the deal to fall apart. We are particularly adept at keeping deals together by working through difficult issues with the buyer, seller, the accountants and attorneys.

17. How Will The Sale of My Business Be Kept Confidential?

Confidentiality of your personal information is a major concern for us. We understand that the sale of your business is extremely sensitive to you. It is imperative that competitors, employees, patients, vendors, banks, landlords, etc are not aware of an impending sale until you are ready to notify them of the sale. Therefore, we prefer to contact the seller via mobile phone, home phone or email. All potential buyers must sign a confidentiality agreement before they receive confidential information. This agreement states that they are aware of the extremely confidential nature of the information they have been provided and that this information may only be disclosed to their accountant or attorney while analyzing this opportunity. Any marketing material or posting regarding the sale of your business will not contain the address or name of your business. Prospective buyers will not know the location or name of your business until they have completed a nondisclosure agreement and we have screened them to ensure they are qualified to purchase your business. Furthermore, all prospective buyers are required to destroy or return any confidentail information they receive from us if they do not complete a transaction.

18. Do You Protect My Identity During the Sales Process?

All transactions can be protected at the seller’s request with the Identity Theft Shield marketed by Legal Shield.

19. How Do I Know if I Got the Best Possible Price for My Business?

We strive to get the forces of supply and demand into action by trying to find multiple potential buyers and sellers. In most situations, this creates true market forces that will help direct prices to levels desired by both buyers and sellers.

20. What Percentages of Businesses Get Sold?

It should be noted that not all businesses for sale actually end up being sold. There are several reasons for this which include seller changing mind, insufficient offers, offers are below what seller are willing to accept, banks will not finance the sale, buyer and seller cannot come to terms regarding the sale and many others. As professionals we try to identify these pitfalls before they happen and communicate with the seller as to the potential success in selling their business.