Selling A Business: Suggestions For Starting The Process

Benjamin Haas |

It’s not every day one sells a business. The vast majority of Americans will never have the opportunity to sell a business, and those that do, will more than likely only do it once! So it’s REALLY important to make sure you’re thoughtful and prepared for this major life event and financial decision. A lot will go into this transaction, so start by understanding the key points you’ll want to have figured out, before you get too deep into conversations with others. 

Here are some tips as you prepare to sell.  

  1. Get an up-to-date valuation of your business. You’ll be asked to share detailed numbers on revenues, cash flow, expenses, inventory, assets, etc. Depending on your type of business there may all be value in “human” assets too; customer and vendor relationships. There’s nothing more important that knowing what a realistic asking price is! Asking for too much may drag out the process. Asking too little and you cut yourself short. Also, if you’re like many other business owners, your retirement may depend on this liquidation. So get a realistic number on the value so you can see what your financial plan will look like, after the sale. 

  1. Get a tax estimate for post-sale proceeds. Like any other investment, you’re more than likely to be subject to a lot of different taxes as part of liquidating the business. What’s most important to your financial/retirement plan is how the sale will affect your cashflow, so you want to be clear what will actually be in your pocket after all is said and done. Take that valuation, work with your CPA, and mock up the taxes to see what the net proceeds will truly be. 

  1. Set a realistic timeline. Is there a robust market for your business? Or will it take some time to talk to competitors, key employees, outside investors? Don’t think of your business like selling a car or even selling a home. It won’t be as simple as those more common transactions. Buying a business is in many ways far more complicated and involves a lot more prep.  

  1. Qualify perspective buyers. The idea of owner a business may excite perspective buyers, but that doesn’t mean they will be qualified – and if they aren’t, it’s just a waste of your time. Do they have the assets to purchase your business? Are they able to get the funding? Qualifying can also mean more than just financial. Depending on your type of business, it may be really important for you to “feel good” and confident about who you are passing the torch to. Do they have the skills and training to carry on your business? Will they provide the products and services that your customers came to know? 

Selling a business will take the support of a couple key professionals like your attorney, tax accountant and financial planner. But before you get too deep into conversations and decisions, review this list and have an idea of what you’re working with.  


Investment advice offered through Great Valley Advisor Group, a Registered Investment Advisor. Great Valley Advisor Group and Haas Financial Group are separate entities. This is not intended to be used as tax or legal advice. Please consult a tax or legal professional for specific information and advice. 

All content and information is for informational and educational purposes only. 

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