13 Jan Around the Web: A Week in Summary
The following information has been sourced by Business Brokerage Press for the benefit of the business brokerage community. The views of these articles do not necessarily represent the views of Business Brokerage Press. We hope you find this information helpful.
A recent article from Forbes entitled “Selling Your Business? How To Answer Nine Questions Buyers Will Likely Ask” explores what a business owner that is looking to sell can expect to be asked by potential buyers. Putting yourself in the buyer’s shoes can help you prepare for a successful sale.
Buyers are likely to ask the following:
- Why do you want to sell?
- What’s so special about your business that I can’t find elsewhere or build it myself?
- How dependent is the business on you?
- How good are your people?
- Will our cultures and values be compatible?
- Is there client concentration risk?
- How do you generate new business?
- How can we grow the company?
- How can I be sure the company will continue to thrive under new ownership?
A recent article from Mondaq entitled “Your Business May Sell In 2023? Personal Considerations” discusses how the sale of a business can impact the owner personally. This is an important aspect to consider when preparing for an eventual sale.
One key consideration is the impact of the sale on your wealth. Think about how your salary, benefits, etc. will change after the sale and what that means for your personal finances.
Another key consideration is the tax consequences of the sale. Things like equity, options, when taxes are due, etc. are all items to think about.
A recent article from The Drum entitled “Want to sell your agency in 2023? Ask yourself these questions first” explores exercises to help business owners determine if they are ready to sell and what their next life phase might look like. This is an important process to undertake well in advance of putting your business on the market.
Exercise 1: Identify what you would like to be doing 3 to 5 years from now if you had all the money you needed.
Exercise 2: Determine what you would need to achieve each year to get to the place you identified in exercise 1.
Exercise 3: Calculate your magic number (sale proceeds after taxes) to be able to afford all of the things you need and want in your life.