Many Singapore business owners choose to sell business as their way of exit strategy. This is the solution of some because of having no successors to continue the business. For others, it was always a part of the plan to convert the company into liquid assets at some point. Whatever is your reason why you would want to sell your company, following these tips will help you get the best selling price and make business selling much easier.
Tip #1: Work Closely With Your Accountant
Before you start advertising your company in business for sale sections and convincing alike people to buy business, spend plenty of time working and clarifying things with your accountant. In addition to tax considerations, seek advice from your accountant about tax issues related to selling of business “stocks” instead of selling business “assets.” A business owner whose intention is to sell business in the future should understand which deal structure is beneficial from business and tax liability perspective.
Also, check with your accountant about your company’s tax filings. Make sure they are up-to-date and business records are free from any discrepancies for prospect buyer’s review. If your company’s records are inaccurate and outdated, then expect prospect buyers to scrutinize your business records more and tough on negotiations.
Tip #2: Sell Before the Business Reach Cyclical Peaks
In the early stages of a Singapore business, owners invest greatly in creating first profitable revenues. After the first wave of profit and the momentum of the effort start to slow down, owners need to invest for another growth firstly by looking for a broker at Eton business for sale from singapore and then through developing new partnerships, services, or products to keep up with the competitive motion. This isn’t the right time to put your business for sale.
The best time to sell business is when new products are increasingly performing well in the market and profits are growing but not near its peak. By this, sellers can present realistic and defendable projections for continuous growth of the company.
Tip #3: Be Subtle
For buyers, the best time to buy business is when the owner desperately needs to get rid of the company. Divorces, partnership breakups, serious illnesses, or sudden death of the founder make it easier for potential buyers to low ball sellers, and succeed.
Business sellers need to understand the worth of being discreet with buyers about the reason of selling the business. Ideally, sellers may have to come up with “a better story” rather than disclosing the desperate truth.
Tip #4: Get the Deal Ready
Just like how home owners beautify and renovate their houses before selling them, business owners should take time in making their business structure and operations attractive to potential buyers. A business appears more inviting after it has settled existing litigations, unloaded slow paying clients, cut unnecessary expenses, and discarded unusable inventory.
It would benefit the owner to iron out revenues that dramatically rise and fall from year to year. If business owners don’t level out unpredictable revenue results, buyers will take advantage of the company’s worst case revenues in negotiations.
Tip #5: Entertain Multiple Offers
When your company is at its best and you’re in the right time to sell, you’ll get better chances of getting a premium price by entertaining several buyers all at once. The most common mistake that business sellers commit is entertaining just one buyer at a time to buy business. If you’re fortunate enough for having multiple buyers competing for your business, you can put your business for sale in an auction and have the buyers bid their offers.
