Whether buying or selling a business, once you’ve agreed the transaction principles there’s still a long way to go before the deal is done. Exercise these skills to ease the process.
Honesty
As a seller you’ll be required to provide detailed information about your business. Avoid exaggerating sales figures or covering up any areas you think are problematic, as the buyer is likely to discover your secrets. If that’s before completion you could jeopardise the deal. If it’s after completion you could face serious financial penalties for misrepresentation or breach of warranty.
Patience
Be realistic about the time it takes to deal with all the necessary stages of the transaction. Although a deal can be done in a matter of days, realistically business sales tend to take between 4 and 12 weeks – and it isn’t uncommon for them to take longer.
Resilience
Both parties will need to put in the hard yards as there is a lot of paperwork to go through. As a seller, you’ll need to provide very detailed information about your business including documents to support the statements you make. It’s easy to take things personally when your business is being scrutinised but don’t – the buyer is just getting comfortable with their investment. It’s also important to know your deal breakers. If there are matters you feel so strongly about that you will not proceed without certain assurances, don’t inadvertently give these away under pressure.
Flexibility
Despite the importance of knowing your red lines and sticking to your guns, remember that both parties are aiming for the same goal: completion of the sale with a happy buyer and seller. Therefore both parties need to be flexible and prepared to negotiate on some issues.
Professionalism
While there will be elements of the transaction you can manage yourself, seeking professional advice to ensure your financial and legal protection is advisable. Saving costs by skimping on these services could cost you in financial terms, and in sleepless nights!