As a business owner, there may come a point when, for one reason or another, you need or want to sell your business. While you may have planned for this as part of your grand plan, selling a business is not always a straightforward process, and there are many aspects that need to be considered from the initial business valuation though to the final details of the sale.
It is common to appoint a business transfer agent, a professional to handle all the aspects of selling your business and we asked Sovereign Business Transfer – UK’s fastest growing business broker and transfer agent – to explain how a broker could help.
Expert knowledge to assess the value of your business
A business transfer agent has a similar role in the world of business sales as an estate agent has in the world of buying and selling houses. With in-depth knowledge of the business world, a good business transfer agent can smooth the path of your sale (or purchase if you are buying a business). Essentially there to help you obtain the best price for your business, these business brokers will carry out a business valuation taking a number of factors into account. With a valuation complete, a business transfer agent will then advise the price to put your business on the market, and guide your through the process to a successful outcome, working to obtain the best, acceptable price for your business.
Work out your sale strategy
A business transfer agent doesn’t just perform valuations thought. If you instruct a business transfer agent early in the process, he or she should help you plan your exit strategy from the business you are intending to sell. This could include organising tax and if necessary, pension advice (for example if the sale is due to retirement), before the sale progresses, ensuring the process goes as smoothly as possible and you know what to expect every step of the way. If you’re intending to invest in another business after the sale, a good business transfer agent can help you to source your next investment at the same time as they are overseeing the transfer of your current business.
Special attention to marketing
With a valuation complete and a price for the market, a business transfer agent will then ensure that your business is marketed correctly, drawing up a prospectus for the sale – a Memorandum of Sale – which provides and accurate description of the business for prospective buyers who have signed a suitable confidentiality agreement. A business transfer agent will be responsible for publicising the sale of the business, and for finding potential buyers. He or she will also be responsible for communication between you and potential buyers. In short, a business transfer agent will handle all details of the sale, allowing you to continue to keep your business running until the point of sale.
Dealing with the legalities
The last details of a business sale come down to the legal procedures necessary to transfer ownership of the business from you, as the seller, to your buyer. Although a solicitor may be required, the business transfer agent should be able to handle many of the legalities of the sale. Alternatively, he or she should be able to liaise closely between your legal representatives and those of the seller to keep the sale running smoothly.
By working on commission – receiving a percentage of the sale – business transfer agents are motivated to obtain the highest price for your business.