What to expect?
Considering selling your business, but no idea where to start? It doesn’t have to be complicated.
Here’s an outline of how the process works:
1
Determine your reasons for selling and decide if the time is right. Selling your life’s work can be an emotional process
2
Organise an initial consultation. We can sign a non-disclosure or confidentiality agreement if needed
3
After speaking, we’ll request some numbers to review historical performance of the business, typically we ask for 3 years’ worth. (Speak to your accountant at this stage to ensure the information is accurate)
4
If we’re both happy, we’ll normally meet in person. While we prefer a site tour, we can meet off-site or out of hours to maintain confidentiality
5
We’ll make an offer, and explain the valuation method. You may want a second opinion from a business broker, try to find one who understands manufacturing. (Careful of those who will promise the earth to get an upfront “listing fee” from you though)
This is also a decent stage to speak about tax planning with your accountant if you haven’t already done so.
6
If you’re happy with the offer. We will send a non-legally binding “Heads of Terms” document to outline the agreement. Both parties sign it to signal their intent.
7
Due Diligence begins. We’ll send you a questionnaire to “look under the bonnet” of the business. This can feel a little intrusive, but is a necessary part of the process.
We’d recommend to involve your lawyer to help out.
8
Preparation of the contract begins.
Your legal representative will review the document with ours, and both parties sign.
9
Completion of purchase on a mutually agreed date
10
Handover period from owner to us
The whole process should take around 6 months, although can be quicker if information is readily available.
The process works best when both parties take a collaborative and proactive approach, our favourite phrase here is “deals are like concrete, the longer it takes, the harder it gets!”