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What to consider before selling a business

For business owners in North Carolina who are looking to exit their companies, 2019 could be an ideal time to do so. However, this doesn't mean that they should sell without first thinking through the sale process. For instance, it is important to understand how market conditions could impact what a buyer is willing to pay. The economy is expected to slow going into 2020 and 2021.

That might make it worthwhile to sell a company in 2019 while conditions are still favorable. Of course, it is also worth noting that available inventory is going up as older company founders are looking to retire. Therefore, it could result in lower prices even in good economic times. When preparing to sell a company, it is critical to have detailed and organized financial information available for buyers to review.

Ideally, potential sellers will have profit and loss statements for the past five years. It is also a good idea to put any revenue declines into context before putting a company up for sale. Business owners should remember that they have to stay engaged in their roles until their companies are sold. In the meantime, they have to do whatever they can to make their organizations more attractive to buyers. This could mean buying new equipment or refining inventory systems.

Prior to engaging in these types of business transactions, it is generally a good idea to be able to present a cogent explanation to potential buyers as to why the business is for sale. There are many reasons besides the owner's retirement, but it is crucial to be able to paint a positive picture.

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What to consider before selling a business | Britton Law, P.A.