Yes, you can sell your business yourself, but you have to do it the right way! As a professional business intermediary, I have many clients with quality businesses who come to me after failing to sell their businesses on their own. The flaw in their effort to sell always comes down to the same four basic things: no professional presentation of the business; poorly presented financial information; pricing the business wrong; and not understanding how to find buyers, work with those buyers and get a deal to closing. If you want to sell a business yourself, you can, but you have to put the right pieces in place, including:
-An effective presentation for selling a business
-A business valuation to help you understand your company's value
-Customized strategies and resources for finding the best buyers
-Resources to help you work with those buyers and get a deal to closing
A Professional Business Sales Presentation This is the centerpiece of your marketing effort. When a potential buyer contacts you, you don’t want to simply fax over some scattered scraps of paper. First impressions count. You need a genuine, professional marketing presentation of your business. At the very least, it should include an Executive Summary, a Business Overview, a Facilities Profile and a Financial Summary. The financial information must be in an intelligent format that emphasizes the cash flow value to a new owner.
What’s Your Business Worth? This is the most important question you will ask yourself in the selling process—and you will probably have the wrong answer. Many of us have an idea of what we think our companies are worth but, unfortunately, we are usually wrong. Pricing your business is one of the most important steps in the process. Price it too low, and you’re stealing from yourself. Price it to high and you’re kidding yourself—but no one else—and you won’t achieve the goal of selling your business. Any business valuation, regardless of the method used or who completes it, will have an element of subjectivity to it, but it can give you some reasonable guidelines and expectations for value and suggest a proper pricing strategy.
Finding the Best Business Buyers This is where the rubber meets the road. It doesn’t matter if you have a great presentation and the right price on your business if you don’t know how to find qualified buyers. It takes more than a couple of classified ads in the local paper or online if you want to get the best price from the best buyer. Multiple strategies including online ads, newspapers, direct marketing and industry publications must be employed. And you must write your ads the right way with the right information.
Closing the Deal This is where a good business intermediary earns his keep—keeping the deal together until you get to the closing table. But business owners are smart, hardworking people. If you know and pay attention to the details along the way, you can make it happen, effectively paying yourself for the work by keeping the commission—often tens of thousands of dollars. You need a good outline of the selling process, access to critical documents like letters of intent and asset purchase agreements and, before committing yourself to a binding contract, the advice of an attorney and a CPA with experience in business sale transactions.
If you put the right elements in place, you can sell your business yourself. Be sure you price it right, package it professionally, and make your buyer search a thoughtful, systematic process.
Donald L. Beezley is COO of BizByOwner, LLC, and a professional business intermediary. BizByOwner gives business owners a complete online solution that helps them sell their own companies without the expense of a broker. BizByowner.com helps sellers value their companies, professionally package the business sale, and then takes sellers through the process of finding the best buyers and how to sell their business—from initial offer through final closing. http://www.BizByOwner.com
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