For some business owners, the company they’re currently growing is a springboard to other things. If the time comes when you decide you want to sell your business, you should ensure that you’re prepared for what the sale will entail.
There are several things that you’ll have to consider as you find a buyer for the company. Knowing these ahead of time is beneficial so you aren’t taken by surprise at the amount of time and work that goes into selling a business.
One of the most important parts of the sale process is having a valuation of the company. This is the basis for negotiations between you and the buyer. In some cases, buying a business isn’t an all-cash transaction. Other terms might come into the picture so you should discuss this all with the buyer and draft a letter of intent that includes all the terms.
You can also expect that the buyer will want to do due diligence on the business. They may opt to review the financial statements, employee information, IP documentation, and similar points. This enables them to make an informed decision about whether they want to make the purchase or not.
Drafting a contract for someone to purchase your company can be a complex undertaking. Working with someone who’s familiar with contract law can help to ensure you protect your interests during the sale. It’s imperative that the written terms accurately reflect the agreement between you and the buyer. Because there might be disputes that arise, you should ensure that there’s also a dispute resolution clause in the contract.