Manchester has been labelled as a northern powerhouse, central to the continued growth of the economy outside of London. It is anticipated that cheaper rent on commercial property in Manchester will result in the migration of a number of businesses from London, as Manchester continues to establish itself as a thriving business district.
Yet notwithstanding all of the positivity attached to Manchester’s commercial scene, according to a recent survey of 500 Manchester based medium sized businesses, 33% of business owners are planning on selling their company in the near future. A key concern among current business owners is that if they fail to exit the market in the near future they may miss the opportunity to obtain the maximum value for their company. For those business owners keen to sell, following these three steps may allow you to secure the best deal.
Identify your main aims and objectives from any sale. This should allow you to focus on what is really important to you during any negotiations and allow you to distance yourself emotionally from the more trivial aspects of selling your company.
Typically business owners are overly optimistic in the valuation of their company. Consulting a legal and financial advisor at the outset can ensure you gain an unbiased appraisal of your business, enabling you to construct an effective and realistic exit strategy.
Your appeal to potential buyers may be determined by your business’ profitability, including previous sales and projected future earnings. It is important that you keep consistent and accurate financial records.
Before committing to any purchase, a buyer is likely to want to undertake some due diligence. For any seller, gathering requested documents and information can be a lengthy process. It may therefore be prudent to organise your records and key documents in advance of any request, in order to speed up the due diligence process. Such records and documents may include: financial records, insurance policies, employee contracts, key business contracts, terms and conditions of business, leases, licences, permits etc.
Finally, patience is key. Organising the sale of a business takes considerable preparation and time. Ensure you continue to operate your business as normal; maintaining a strong brand identity and profit margin will be sure to attract the highest bidders.
In any case, the selling of a business can be a detailed and complicated transaction. At Farleys, our corporate law team are able to guide you through every stage of the sale: from negotiating and drafting heads of terms, responding to any legal due diligence, negotiating and drafting the key transaction documents, advising you on the contents of those documents and ensuring that the acquisition is completed successfully.