Selling your business!
12 steps to selling your business
1. Seller’s Assessment
The first step is to assess the needs of the seller. Determine the features, and benefits as well as the financial, industry, geographic limitations. Identify the terms and conditions of the future sale.
2. Strategy & Valuation
The market is assessed and a proposed valuation based on all the data provided and available is presented along with a strategy for marketing and positioning the business sale. A listing agreement is signed between the seller and NAI Commercial Central Vancouver Island Ltd.
3. Business Assessment
Through guided interviews and questionnaires, the details of the business are assessed and recommendations are made to better position the business for sale to ensure maximum valuation, exposure and demand.
4. Feature Sheet
A non-detailed summary of the business opportunity is prepared to act as a “teaser” in the early stages of purchaser communications. This feature sheet promotes the merits of the business without supplying and identifying confidential corporate information.
5. Confidential Information Memorandum
A Confidential Information Memorandum (CIM) is prepared which provides the details of the opportunity and further in-depth information to allow potential purchasers who have been pre-qualified and have signed an NDA to explore the business.
6. Buyer Qualification
The identified purchasers are qualified in terms of capacity to purchase, expertise or capabilities in the specific market, seriousness of interest and that their valuation expectations are realistic. The CIM is presented only after qualification and once the non-disclosure agreement is signed.
7. Letter of Intent Presentation (LOI)
The purchaser prepares a Letter of Intent (LOI) outlining the basic structure of the proposed purchase setting out the applicable subjects and conditions.
The seller accepts or more likely responds to the Letter of Intent and a negotiated agreement is reached.
9. Signing the Letter of Intent
Once both the purchaser and seller have reached an agreement on the general terms and conditions of the LOI, it is amended to reflect the agreed upon terms and conditions and both parties sign the LOI.
10. Due Dilligence
The purchaser performs whatever reasonable due diligence they feel appropriate and/or is required by their financing institution. The intent of the purchaser and his or her evaluators is to establish an accurate risk assessment profile of the business.
11. Share or Asset Sale Agreement
Due diligence may result in further negotiations to fine-tune the details of the lawyer-prepared final Share or Asset Sale Agreement.
The final purchase agreement is signed and handover happens. The new owner will assume all responsibilities and risks as outlined in the agreement.