Selling a business requires a lot of work. In addition to finding the best business broker for manufacturing companies Orange County trusts, you will need to hire other professionals such as a CPA and a transaction attorney. You will then need to determine if now is the best time to sell then come up with a pre-sale plan. Deciding on the best exit strategy is yet another crucial thing you will have to do. In this post, we will not be dwelling too much on what is involved in the sale of a manufacturing company but rather on the three most important questions you must answer before you get started with the sale.
What is it worth?
Before you can set a selling price, you have to know how much your business is really worth. What you believe your business is worth is not enough. You need facts in order to convince potential buyers to buy it. For this, you will need the input of an experienced business broker for manufacturing companies Orange County recommends. The business broker will determine the best valuation method to use. in most cases, when performing a business valuation, the broker will pay attention to your company’s financials for the last 3 years. The broker will also use their market experience to determine the most appropriate selling price.
There are also other factors that will be considered when determining how much your business is worth including:
- absentee owner or not,
- profit margins,
- industry served,
- concentration of revenues,
- age of your business
- quality of business financials
- owner willing and able to transition
- ability to offer seller financing
Determining the actual worth of a company is the most important stage in the sale of a business. Keep in mind that buyers will have time for due diligence. If their findings don’t match with what you provided, you might lose their trust.
How do I maintain 100% confidentiality?
Another important thing you must do is know how to keep the sale a secret. The more people learn about the sale of your company, the more problems you will have. For example, if word gets out that you are selling, employees, loyal customers, suppliers and lenders may abandon you due to the fear of the uncertain future. Keeping the sale confidential is of utmost importance. To achieve this, your business broker will draft confidentiality agreements and NDAs that have to be signed by all potential buyers. The broker will also act on your behalf so that the company is not directly linked to you. Prequalifying potential buyers also goes a long way in keeping the sale 100% confidential.
When is the best time to sell?
Last but not least, you have to time the sale perfectly. The best time to sell is when your business is doing very well and you are not being pressured to sell. The economic conditions must also be right. Your business broker for manufacturing companies in Orange County can help time the sale right.
Business Broker for Manufacturing Companies Orange County