Thinking About Selling your Business?
by Bradley Smith | Oct 23, 2024 | Latest News
You’ve been running your own business for many years and the time has now come for you to sell the business and ease into retirement.
What to do and where to start can feel overwhelming. It does not need to be, provided you obtain good advice from your financial and legal advisers from the outset, and before you decide to market the business.
Advice from your lawyer will enable a draft contract to be prepared and will give you some guidance for things to expect during negotiations with a buyer. Additionally, your accountant will assist you with determining a value for business and any tax implications that will flow from the sale.
For contract preparation and your negotiations with a buyer, you will need to be mindful of many matters which need to be taken into account. Such things include:
- The business name associated with the business
- Does this business own premises or is there a current lease for premises?
- How will the goodwill and equipment be apportioned on the sale price?
- What equipment and assets are being sold with the business?
- Is there any stock being included? Is it in addition to the sale price?
- Will you agree to a restraint of trade? The purchaser will expect that you will be restrained from competing against them for a particular period of time.
- Alternatively, does the purchaser want you to stay on board for a period to assist with the business transition and act as an adviser?
- What training will be provided if any prior to or after completion
- What business contact details are being sold with the business?
- Are there any special or specific contracts that need to be included?
- What security interests do you have over the equipment or equipment?
- There are also employment law considerations if your business has employees.
You will need to consider whether you wish to sell your business through a business broker or authorised real estate agent or by some other method such as your own advertising. Very often, established businesses are sold to an employee or through word of mouth. Sometimes your competitors are interested in acquiring your business.
A buyer is going to want to know the financial information for your business and this will involve you handing over confidential information that you might not feel comfortable with. A confidentiality or non-disclosure agreement is always important to consider before releasing any information. Your lawyer can help with that.
Obtaining legal advice as to the structure and nature of your business can streamline the process for you and ensure that you have confidence when you are negotiating your sale. You will be aware in advance of the things that need to be taken into account. We have experienced business and employment lawyers who regularly act on the sale and purchases of businesses. Let us help.