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Key considerations when buying and selling businesses

On Behalf of | Feb 17, 2020 | Buying & Selling Businesses |

When buying and selling businesses in North Carolina, there are many aspects to consider. Those selling the business will want to maximize its value. Those who buy a business will need to know what they are buying. This is true whether it is a large, small or medium-sized business.

Understanding fundamentals is important. It can be confusing to formulate an accurate value when selling or buying. This goes beyond money and sales figures. These are important, but net profitability is essential to get an accurate appraisal. That includes assets, profits, tax costs, expenses and more. Assets fall into two categories: tangible and intangible. Tangible includes real estate, computers, vehicles and equipment. Intangible assets could be intellectual property, customer lists, how recognizable the brand is and similar factors. These should be valued.

Listing the business for sale will play a vital role in its sale and purchase. Listing it online and in the most effective locations makes a big difference. Deciding to advertise in a newspaper may be a mistake in the current web-based climate. Many might hire a broker to facilitate a sale or purchase. That can be useful as potential buyers may be found. It can also help with deciding on a price.

Purchase and sale often includes negotiation while the sale is in progress. If the offer is deemed to be too low, most business owners do not need to accept it. Other concerns are the future of the business and ensuring it is in good hands. Flexibility can be imperative. Some buyers and sellers will agree to work together during business transactions. Adding parameters to account for this in the contract is wise. Having legal advice should not be ignored when buying & selling businesses and a law firm with experience may be able to help.