The process of selling a business is very hectic and that is why you need help from an experienced business broker San Diego. Find a professional who has sold businesses that are similar to yours and one that you feel comfortable working with. A good business broker will take the pain out of the sale by taking care of everything and help you navigate the obstacles with ease. After closing, the exhaustion will most likely hit you together with the emotional impact of letting go of your business. However, if you sold for the right reasons, the pain will quickly go away. But what happens next after selling your business?
You may still be tied to the business
Even after selling your business, you may still need to continue being tied to it for a few weeks or even years. This is in accordance to the agreed terms. To facilitate the sale, business brokers San Diego may advice that you stay on as an employee or consultant. If the new owner still owes you money, especially when you went with seller financing, you will have to stay with your former business for months or even years until the debt is cleared.
It is good, however, to note that you will be less involved with the daily operations of the business. In most cases, this involvement is usually short lived.
You need to invest the proceeds of the sale
After selling your business you will be left with a lot of money in your hands. One of the things you will have to worry about after the sale is what to do with that money. One of the things you will have to do is schedule a meeting with your financial planner and attorney to see if there are any creative ways to structure your holdings and minimize income taxes. Your business broker, on the other hand, can help find a good business to buy or invest in.
Educate yourself on investment
Having a lump sum of money in your hand is a good thing but also a bad thing at the same time. If you are not careful, you might end up misusing that money. This is why it is a good time to learn about investments. Don’t rely solely on the expertise of professional advisers.
In most cases, after selling their business, most people miss the challenge and risk that comes with entrepreneurship. They end up buying or starting a new business to scratch that itch. Whatever you decide to do make sure you get expert advice first.
Hiring a business broker Orange County is obviously the number one thing you have to do when planning to sell. The broker will help set the selling price, market your business, prequalify buyers, help with negotiations, assist with the paperwork and ensure everything is on the right track. An area where most sellers get stuck in is closing. Once everything has been done and it is time to transfer ownership, so many things may get in the way and keep you from closing fast. Here is a quick checklist that will help you prepare for a smooth closing.
Schedule the closing
You need a closing date in order for all the parties to be focused. When all the parties are available, you should go ahead and set the closing date. The best time to close is in the morning hours so that you can get to the relevant government offices and banks following the closing. Business brokers Orange County recommend closing in the last day of the quarter, month or pay period. This will simplify the proration of the monthly expenses that transfer with the sale.
Finalize the purchase price
The final selling price needs to be finalized so that it reflects the outcome of the negotiations, prorated rent, utility and other fees. You also need to account for the final accounts receivable, final inventory value and the accounts payable value.
Get the documents ready
Not having all the documents ready is the number one reason why there are delays in closing. Your business broker will make you aware of all the relevant documents. Make sure they are clean and organized. If yours is a corporation, your transactional attorney will pass the corporate resolution authorizing the sale.
Get the tax forms ready
You will be dealing with a lot of forms such as those needed by the Secretary of State or Corporation Commission, transfer documents for the vehicles, IRS Form 8594 and so on. Your transactional attorney and business broker Orange County will help with this.
Prepare closing/ settlement sheet
This will list the purchase price and the costs as well as price adjustments that will be paid by or credited to the buyer and seller. Your attorney will help with this document unless you are closing through an escrow.
Other important things you need to add to the list include:
- Confirm insurance requirements
- Prepare for the transfer of agreements and contracts
- Prepare a furniture and equipment sale list
- List as well as transfer of work in process
- Prepare the loan documents
- Prepare the bill of sale
- Prepare personal agreements
- Prepare the transfer of building lease
- Prepare the succession agreements
- Prepare a bill of sale
The sooner you prepare the better. The rule of thumb is to ensure that you have the right help. Find experienced business brokers Orange County to help with the sale.