[ PREPARING ]
The decision to sell your business can be a difficult one.
Selling a business is something that most business owners only do once in their life. Why? Simply put, because it’s hard. You may be an expert in what it takes to run your business, but when it comes to selling a business most owners find themselves in unfamiliar territory. The size and complexity of the task can quickly become overwhelming. Throw in the fact that selling your company will likely be the largest financial transaction of your life, as well as a significant emotional event, and it’s no wonder that many successful business owners fail to complete a successful sale — or even begin the process at all.
It starts with a lot of questions.
- Is now the right time for me to sell my business?
- Is selling the best exit strategy for me, my family and my business?
- What is my business is worth to a buyer?
- Who do I need to help me with selling my business?
- What types of buyers will be interested in my business?
- Where do I start?
Allan Taylor is here to help you find answers.
We start by taking the time to get to know you, your business, and your reasons for wanting to sell. We will provide you with honest feedback about how ready both you and your business are to go to market. We will also help you set realistic expectations for what the selling process entails, and how buyers will view your business.
No matter where you’re at in your decision to sell, we’ll meet you there.
While selling a business may seem daunting, it’s what we do every day at Allan Taylor. As successful entrepreneurs who have started and sold ventures of our own, we’ve been in your position and understand that selling a business is more than a transaction. It’s the culmination of an extraordinary accomplishment, and the beginning of what comes next — whether it’s a long vacation, full retirement, or the launch of your next great idea.
[ FAQs ]
Find answers to some of the most common questions business owners ask.
SELLING CAN BE HARD
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[ FAQS ]
How long will it take to sell my business?
It typically takes six to twelve months from the time you sign an Engagement Letter with us to the day of closing. We tell clients to mentally prepare for the selling process to take about a year, although our deals often close in six months or less.
You may need to build in more time to prepare your business for the selling process. If you think you want to sell your business sometime in the future, we recommend that you talk to us two to three years prior to your ideal sell-by date.
We don’t believe in rushing anyone through our process, sellers or buyers. It’s not about finding a buyer quickly, it’s about finding the right buyer that will meet your personal and business goals.
What will I pay in taxes?
This can be difficult to determine without an offer in place that outlines a proposed deal structure. There are so many variables that affect how your sale proceeds will be taxed that it can be a mistake to try and guess. (If anyone tells you you’re going to pay 40 percent no matter what, please talk to us.)
We can work through a few scenarios with you — with guidance from our in-house CPA — to give you an idea of what you might expect to pay in taxes. We can also discuss ways to mitigate, defer and/or lower the tax consequences from a sale. Just know that it will be a big part of the negotiation process with a buyer, and one of the reasons sellers hire us to represent them.
What types of buyers will be interested in my business?
This is one of the things we discuss with you after completing our valuation process. Most buyers fall into three general categories: entrepreneurial operators, financial buyers like private equity groups, and strategic buyers. We caution business owners to keep an open mind when it comes to buyers. Your “ideal buyer” may be someone you’ve never thought of. We work hard to attract several types of buyers for your business so that you can find the best fit for you and your business.
Will I get all cash at closing?
The short answer to this question is no. Most buyers will require you to keep some skin in the game, as will many lenders who are helping finance the acquisition of your business. Oftentimes this has as much to do with intangible reasons — like trust, confidence in the business and good faith — as it does with financing. The last thing any buyer wants is for you to sell them your business then disappear. With that said, we try to structure deals so that sellers get at least 60-80 percent of the sale price in cash at closing.
What is my business worth?
This is a great question, and one you need to get answered before you decide whether or not to sell your business. Please see our Valuation page and related FAQ’s for more on this important topic.
When is a good time to sell my business?
We’re so glad you asked this question! One of the ironies of small-business ownership is that the best time to sell your business is typically the time when you’re least likely to consider letting go of it. If you think of your business as an asset (like we do), you’ll want to sell at the peak. In general, buyers like to see at least three years of consistent growth and profitability from the operations of your business, as well as several years of future growth to capture within your business and industry.
Another way to answer this question is to mention when it’s a bad time to sell your business. If your business is experiencing the following, it’s probably not a good time to sell: declining sales and/or profit margins, industry as a whole is in trouble or waning, you passed the “burnout” stage years ago and have let things languish.
How will I tell my employees?
Most sellers list this as one of their top concerns, and we understand why. Rest assured that there is no right answer to this question, as it varies from owner to owner. We’ve met business owners who wait until the deal is done to tell employees, while others include a key manager to help with due diligence efforts, or even with the decision to sell or preparing to sell.
What if I don't want to sell now, but would like to sell my business in the future?
As mentioned above, if you think you’d like to sell your business some day it’s best to start planning at least two to three years in advance. We recommend that you get a business valuation immediately to see where your business is at today. That way we can work together to come up with a game plan to maximize value before going out to the marketplace and finding buyers for your business.
The reality is that both you and your business must be ready for the selling process. We will give you our honest opinion about your situation, and work with you to identify a reasonable timeline for the sale of your business.
[ LET'S START THE CONVERSATION ]
I’ve had the pleasure of having Allan Taylor & Company on my team for the past three years. They have lead our efforts to define and evaluate all layers of my business. They help me measure where we fall into each category, determining and planning what steps are essential to reach the top and add the most value. Chris and Barbara take what can be an overwhelming process and break it down into attainable benchmarks. – Laura T. (Business Owner)