When You Meet With Someone To Begin The Process Of Selling Their Business, What Are Some Of The Most Important Questions You Ask?
A lot of people who have made the decision to sell their business want to immediately discuss the sale price, which is premature. I talk to them about the nature of the business, the size of the business, the number of employees, and whether it is family run or not. Most of the businesses I deal with are not publicly held companies. They are small-to-medium sized private companies, so I don’t have to worry about SEC regulations regarding filings and sales. I do need to find out the family dynamics, whether or not they have a buyer in mind, and if that could lead to a conflict in regards to certain disclosures that may need to be made.
The next area that I get into is why they are selling their business. Are they selling because they are going into retirement? Is there an illness or has a principal died? Has a partner died and they don’t want to continue without that particular partner? Does anyone have the right of first refusal? Finally, we will move onto the question of price. Sometimes, you can determine that fairly quickly and other times, you can’t. There may be research that I need to do or the need to bring in other professionals.
What Due Diligence Do You Perform When It Comes To Helping Someone Sell Their Business?
Everything depends on the nature of the business and how sophisticated the particular business is. There are people who have been in business their whole adult life, but their focus is very narrow, so they may not have the expertise to understand what the value of their businesses is. It may be inflated or they may think the value is much less than it actually is. There are economic factors, depending on what sector of the business it is in. There may be real estate questions or equipment that is involved. I have to analyze those as well as whether there are tax ramifications. There are all kinds of due diligence that needs to be made before the business should be put up for sale.
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- Which Other Professionals May Need To Be Brought In To Assist In Various Aspects Of Selling My Business?
- What Determines If This Is The Right Time To Sell My Business? What Factors Should A Business Owner Be Looking At?
- How Is The Value Of My Business Determined And What Is My Attorney’s Role In This Process?