If you have come to a point where you would like to put up your business for sale, you will find that it will not be an easy task. Most business owners consult their accountants and lawyers for advice and strategies but their part represents only a tiny part of the process.
Operating a business alone takes too much time that the process of selling a business will be hard to handle. Given the intricacies of the process, it is best to have an expert and professional Las Vegas Business Broker to effectively and efficiently manage all the aspects of the transaction.
Even if you are adept at businesses, the process of selling a business involves a level of expertise that only a Las Vegas Business Broker have. There are details and aspects of the transactions that cannot be handled easily, even the most experienced and successful business owners.
For the sale of the business to be successful, here things 7 to know before you jump into selling the business.
1. Determining a Realistic Sales Price
There is nothing more frustrating than putting up the business for sale and not attracting buyers because of the steep price. One of the most important tasks of a Las Vegas Business Broker is to know the fair market value price of the business.
Establishing a realistic pricing is a complex analysis of several factors – both tangible and intangible values – and different methodologies to ensure that the business will be priced correctly.
Determining the right price for the business is set using different factors. There are business appraisers who are experts in putting a realistic price on the business, using different indicators and market data. The broker also assists both the seller and the buyer in the pricing and deal structure so as to make sure that both parties will benefit from the transaction.
2. Knowledge of the Current Market
It is important to be up-to-date with the current marketplace conditions to be able to properly decide on when to put your business on the market. Business intermediaries have different tools and databases that help them determine these conditions. And with the network, reports and business contacts that they have, they will be able to help you make the right decisions on the sale of your business to decide whether it is the right time to place your business in the market.
There are many negative effects on the sales and profitability of the business if it is introduced in the market prematurely. There will be different reactions from customers, vendors, competitors, employees, and creditors if they find out that your business is for sale. Prospective buyers most of the times react negatively to business opportunities that have not been made confidential. That is why it is imperative that the business owner understands why confidentiality is important to the success of the sale of the business.
The Las Vegas Business Broker is responsible to hold the sale of the business in strict confidence. Aside from maximizing the potential of the sale, the broker has a fiduciary responsibility to maintain confidentiality.
Your company will continue to operate normally and protected against competitors who might use the information to their advantage, employees who might think of leaving due the possibility of a new business owner, customers who might take their business someplace else, contractors and suppliers who might raise their prices and bankers who will demand due to a note if privacy on this matter is maintained.
4. Attracting and Securing Serious, Potential Buyers
Buyers are often classified into three groups – individual, financial and strategic. Individual buyers are people who are in the 45-60 age bracket. They are those who dream of leaving the corporate world and pursue their dream of having their own business. The second one is the financial buyers. These types of buyers are those who are primarily interested in the company’s return of investment. Last are the strategic buyers. These buyers are oftentimes your business competitors, suppliers or sometimes customers of your business. Their goal is to integrate the business into their existing ones to be able to create a wider market and bigger long-term shareholder value.
Buyers can be found locally, nationally and even internationally. Having a broker in this process is key to success as they have contacts with all types of buyers all over the world. They have databases and they use effective and efficient ways to screen buyers who are the perfect fit to buy your business.
5. Lender Financing
Surveys show that in most cases, businesses that are put up for cash only do not sell. In cases where businesses were sold at cash only, it has been found that the owners only receive 75% of what they initially asked for. Whereas, they receive 86% and above their asking price if there are financing terms available.
A Las Vegas Business Broker can help you come up with reasonable terms so both the seller and buyer. With their many contacts, a broker can even provide a lender that suits perfectly for both parties, greatly increasing the possibility of a sale.
6. Eliminate Red Tape
There are some pitfalls in the process of selling a business and a broker is an expert in looking ahead and eliminating these possibilities. Some of these problems include processing permits, licenses, financing, agreement, leases etc.
7. Negotiating the Business
Negotiating the sale of a business can be difficult. It can add in stress to the seller especially if things do not go as planned. Buyers tend to ask to information on the valuation of the business and financial information that sellers become defensive most of the times.
A Las Vegas Business Broker can help you by being the middleman and putting in strategies to achieve your goal, without putting too much strain and compromise on you.
A broker helps communicate to the buyer and they are adept at pushing the right buttons of the buyers. They also understand your goals as well as the buyer’s point of view that he is able to make sound and fair negotiation to close the sale and while still considering the both parties’ objectives. Their goal is to create a “win-win” scenario for both parties.
With the knowledge of negotiating price and terms, and the broker will be able to help uncover concerns for both parties and be able to offer advice.
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