If you're considering selling a business, you're likely curious about what the process involves. A business lawyer can guide you through this experience and advise you at every step. First, however, it can be helpful to understand the basics of putting a business up for sale.

How to Sell a Business

1. Obtain a Valuation

The first step is to contact a business appraiser and schedule a valuation. This will give you an idea of how much money the enterprise can realistically sell for, which helps you determine the listing and sale prices and what the profit will be. Also, potential buyers want to know the business's risk and growth potential, both factors that a valuation will define.

2. Organize Your Business Finances

Potential buyers often want to see financial statements before making any big decisions. This way, they have documented evidence of profits and losses and can make an informed choice about whether to place an offer. Work with your business lawyer to clean up your financial records going back at least three years. Settle debts, resolve tax issues, and double-check that no personal assets are kept on the business books.

3. Plan an Exit Strategy

A business lawyer can assist you in preparing for your exit from the company. This will help avoid service disruptions that can be frustrating for the new owner and customers, resulting in financial losses. Most current owners choose a gradual exit from the business, giving the new owner plenty of time to learn the ins and outs while allowing the business to run as usual, without significant losses of revenue or customers.

4. Hire a Broker

A broker will connect you to potential buyers and ensure your business sale moves smoothly. They and your business lawyer will facilitate the process and handle all the necessary paperwork for the listing and sale of the property. Brokers are also natural salespeople, and because they make a commission off the transaction, they are just as invested in a successful outcome as you are.

5. Find a Buyer

A broker will bring in potential buyers, but there are some steps that will help you narrow down your choices to the most serious contenders. First, find out if interested buyers pre-qualify for a loan. Keep a few potential buyers in the pipeline and maintain communication with each in case a first—or second—offer falls through. Be ready to negotiate, but don't accept less than what the business is worth. If the buyer plans to finance the sale, your lawyer and accountant should be in touch with their representatives to reach a mutually acceptable agreement. Be sure to put all agreements in writing.

Let The Law Office of W. Randall Holcomb PLLC help you navigate the sale of a business. Attorney Holcomb is a business lawyer serving clients throughout the Greensboro, NC, area. He offers representation in sales, mergers and acquisitions, contract disputes, commercial litigation, and other legal issues. Visit the firm online for a complete list of services, or call (336) 888-8760 to schedule a consultation.