04 Mar 5 Stages Of Selling A Business In California
The task of selling a business is all the more crucial than establishing a business. Nowadays, it takes almost a year to sell a business in California. The effort which you took earlier to establish a business will be double in selling the same in today’s market. For this process, a reliable broker is important who will understand the present market and will make the process of selling easier for you. Research is very important before going out in the market to sell your business.
To sell a business there are five stages in the process that will make life easy for you. Read this blog to get a proper insight.
- Stage 1- The Meeting: The business owner who has decided to sell the business is always advised to meet the broker in the initial stage. This is a preparatory stage that is really important to build a trust between the business owner and the broker. A good broker will understand the unique selling proposition of the business if there is any. On the other hand, if the broker feels that you’re not in the position to sell, he will ask you to rethink and work on the business more. Half of the businesses don’t sell because they’re not in the position to sell. Once this is clear, you successfully move to the next stage.
- Stage 2- Research and Analysis: In this stage the broker takes over the client. He conducts a thorough research and analyzes the financial record of the company for a minimum five years. The broker will check closely what has been sold in and around the market. She/he will add value accordingly to the company before bringing it up to the market at the right time. This stage is extremely crucial and needs to be dealt with patience. Ultimately, buyers out there will look for profit in buying a company. If you’re able to cater them with good profit then you’re through in the process of selling a business.
- Stage 3- Marketing strategy: This is a time taking stage as it has the major task of making people aware of the company in the market. The signing of the agreement is necessary for this stage to go ahead with other proceedings. After the deal, the broker prepares the marketing packages with which they come close to the potential buyers. E-mails, phone calls and messages are the ways in which the buyers are approached. After reaching the mass, the interested buyers are shortlisted and a meeting is fixed. At the end of this stage, your business will be put up for auction.
- Stage 4- Audit: In this stage, the buyers become alert about the failures and drawbacks of the business being sold in the market through various kinds of audits. Their bank agents and other resources investigate the matter. Any negligible problem can be overlooked by a buyer until and unless it is considered a cause for loss to the company.
- Stage 5- Deal closing: After all the above stages, the buyer gains confidence in buying the company that is up for sell. In this stage, all the major paper works are done followed by negotiation, agreements and last but not the least the signing and closing of the deal.
After you are through with these five stages, your company is sold and your bank account is flooded with money. This calls for a party. Isn’t it?