Seller's exercise for thought - exactly what am I selling ?

 By Sudarsan Pattabiraman (M&A Advisor) | 510.944.5616 | sudarsan@upclinch.com

When buying or selling a business, it's often one of the most significant professional and financial decisions in a person’s life. Below are key questions to start exploring, to initiate the selling thought process:

1. What exactly is for sale? 

   Clarify what’s included in the sale. If you own assets like machinery or real estate tied to the business, will these be part of the deal?

2. What assets generate revenue? 

   Identify which assets are actively earning. If some assets aren’t generating income, consider whether selling them is beneficial.

3. What is proprietary? 

   Both buyers and sellers must assess any proprietary elements, such as software, patents, or formulations, as these can add significant value. Sellers should highlight these aspects effectively, and buyers might need experts to accurately evaluate them.

4. What is your competitive advantage? 

   Understanding and framing the business’s competitive edge is crucial, whether it's a niche market, advanced processes, superior marketing, or other factors. This can help buyers recognize the full value and potential of the business.

5. What is the growth potential? 

   Buyers should evaluate whether the business has room to grow. If growth opportunities are limited, it will impact their offer and decision-making.

6. What agreements are in place? 

   Examine agreements like employee contracts, non-competes, and key management dependencies. Buyers will want to know if critical staff are secured and how reliant the business is on its owner or manager.

7. What financial information will the buyer need? 

   Make sure the buyer understands key financial aspects, such as working capital requirements and how the business handles financial reporting.

 Before selling, consider the business from the buyer’s perspective: What questions would you ask if you were on the other side of the table?

 Buying or selling a business is complex, and every business is unique. There’s no one-size-fits-all approach. Engaging a skilled business broker or M&A advisor can help ensure a successful outcome for both parties.

Contact Sudarsan for planning and executing your perfect exit / strategic acquisition. Schedule time to unlock the business value and realize it for the benefit of you, your family and your community. 

Email:sudarsan@upclinch.com   Phone: 510.944.5616