| 1. |
Commitment |
| |
Selling a business is a
serious business for all involved. You must have the
mental commitment to offer a fair price and to accept
reasonable terms consistent with the marketplace.
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| 2. |
Selecting Your
Professional Team |
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In addition to selecting a qualified
broker such as Mercury Business Brokerage, we strongly
advise you to seek competent legal counsel as well as tax
and accounting advice. If do not have your own advisors,
we can provide you with a list of several whom other
sellers have successfully used in the past.
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| 3. |
Determining
Value—Selecting the Sales Price |
| |
Mercury Business Brokerage
professionals will prepare a broker’s opinion of value
and will explain to you the elements that come into play
in valuing a business. They will help you understand the
possible price you might receive for your business, and
ultimately you will set a sales price that assures a
reasonable chance of selling your business.
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| 4. |
Transition Plan |
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Understanding the possible structure of a
deal is crucial. The terms are affected by how much cash
is required, minimization of the effect of taxes,
continuity of key employees, and many other
considerations. We will help you understand what to
expect.
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| 5. |
Documentation and
Marketing Strategy |
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You must provide financial statements and
other information about your business. Mercury Business Brokerage
will prepare a confidential profile and comprehensive
marketing package for qualified buyers. Preparation of
this package includes recasting your financial statements
to show the real cash flows after removing the owner’s
discretionary items. Then we extensively advertise your
business locally and nationally, in print as well as on
the World-Wide Web. Advertising is done in a generic,
confidential manner that does not reveal the name or
location of your business. No details of your business are
released without your approval.
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| 6. |
Screening of
Buyers and Confidential Introductions |
| |
Mercury Business Brokerage
screens all buyer inquiries and weeds out the tire kickers
and time wasters. This allows you to stay focused on your
business. Qualified buyers will then sign a
confidentiality agreement before being given any specific
information about your business. More information is given
to them as they narrow their search and show greater
interest. Finally, buyers complete a detailed buyer
profile that ensures they have the financial ability to
complete the transaction, before they are given the
complete marketing package on your business.
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| 7. |
Showing the
Business and Meeting the Buyer |
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We will arrange for the buyer to visit
you and your business so that we can walk them through the
facilities to view the operation firsthand. This visit
will be done at a convenient time for you. You should
never meet the buyer alone. We’re there to act as your
intermediary and are experienced at positioning your
business and at handling difficult questions. Many a deal
has died by an overeager seller meeting alone with an
aggressive buyer. We will review with you a list of dos
and don’ts before any meeting takes place.
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| 8. |
Receiving the
Offer to Purchase |
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We work with the buyer to obtain a
written offer. We represent your interests and explain
your position. Most offers will have some contingencies.
We will work to see that they have a time limit and are
reasonable. When the offer is complete, we will present it
to you and explain the reasoning of the buyer. We help you
understand the buyer’s background and abilities so you
can make good decision.
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| 9. |
Negotiation and
Acceptance |
| |
We continue to work with you and your
advisors to reach terms that are acceptable to both
parties. As your business broker, we can add great value
during this negotiating process. We will prove beneficial
by helping to select alternatives and working to complete
the deal. Once the offer is accepted, then it becomes a
purchase and sale agreement, with contingencies.
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| 10. |
Due Diligence and
Contingency Removal |
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Now begins the in-depth inspection of
your accounts and records. Agreement for the lease to be
assigned, public-records searches, and verification of
assumable loans and trade agreements occur. When all the
contingencies have been removed, the purchase and sale
agreement is binding. It is important to work quickly to
provide the buyer with everything needed to remove the
contingencies. Time can work against you, and a buyer can
go cold if too much time passes.
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| 11. |
Open Escrow |
| |
The purchase and sale agreement and all
other documents relating to the sale are turned over to a
neutral third-party escrow company. Escrow prepares all
the closing papers; performs lien searches; and prorates
rents, deposits, taxes, and other items to the closing
date. Escrow also makes sure all secured creditors are
satisfied and ensures that all other security agreements
and related documents are completed. Final arrangements
for the payoff or assumption of all notes and leases are
made. Your advisors and the buyer’s advisors review all
these arrangements until all parties are satisfied. The
costs for the escrow attorney are minimal and are shared
equally between the buyer and seller.
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| 12. |
Inventory and
Closing |
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Final inventory is taken. Old notes are
paid off or assumed; and new notes, agreements, and bills
of sale are signed. Then it’s celebration time!
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