How to Sell Your Business For It's Maximum Value

Deciding to sell your business can be tough, but failing to maximize the sale price of your business could mean the loss of hundreds of thousasnds or even millions of dollars. The fact of the matter is that there are many areas and so many mistakes that we tend to ignore when it comes to selling your business.

Difficulty: Moderately Challenging

Instructions

1. Find A Good Broker
   
   Just as a prospective buyer of your company will exercise due diligence so should you. Examine your broker's background, experience, and credentials. Take your time. Check with the Better Business Bureau and even ask for references. You can check with the International Business Brokers Association (IBBA). This is a non-profit "trade association of business brokers providing education, conferences, professional designations and networking opportunities" (IBBA), as well as professional certifications.

2. Get A Valuation
   
   Business valuations are typically based on assets, inventory and even cash flow. This is comprised of a combination of the corporation's net income, owner's salary, interests expense and other perks paid by the business. This is a determining factor in the company's future potential.

3. Advertise; Locate Potential Buyers
   
   Don't compromise. Entrepreneurs are everywhere, always ferreting out potential money-making leads, so spread a wide net. Offer to provide potential buyers with a business profile provided by a third-party audit, certifying that your business is what you say it is. Don’t forget that you competitor might want to buy you out and turn the business into one of their branches.

4. Negotiating; Never Discuss A Price Too Early
   
   Timing is the name of the game, and without losing sight of your agenda it is not necessary to discuss a price too early. This is a common pitfall when it comes to selling a business. Do not even touch on the topic of money until you know that they really want what you have to offer.
   
   The selling of your company is a complex transaction. Take the time to learn and clarify all uncertainties, while weighing all of your options.

5. Confidentiality Agreements
   
   Once you have found your prospective buyer you'll need to prepare a confidentiality agreement that you'll ask any prospective buyers to sign. Potential buyers will also agree to keep confidential the fact that your business is for sale, since that news could be detrimental to the ongoing operations of your firm if it leaks out before you are ready to announce a sale.