Q: What type of offers should I expect to receive?
A: An astute buyer is going to structure the initial offer to insure that they get the best possible price and terms from you. Therefore, you should expect to receive low initial offers. Don't be offended - this is just an initial offer to "test the waters". If you are asking $400,000 for your business, a prudent buyer may offer you $200,000 (or less) in the initial offer. The buyer does not expect you to accept the initial offer, nor should you expect the buyer to accept your initial counter offer. All offers that you receive will have some contingencies. Generally, these contingencies concern review of the financial information and reaching agreement on a training and transition period. Contingencies are normal and provide the buyer with the ability to check out the business more closely before closing.
Q: How long is the training period for the buyer?
A: Typically you will be expected to provide two weeks to two months training in the business with an equal time of telephone consultation. Remember, you still may have an investment in the business, so proper training is in your best interest.
Q: Will I have to sign a non-compete agreement?
A: Yes. Typically the non-compete agreement covers the category from which your current customers are generated, and the time period usually equals the term of the financing you are providing to the buyer.
Q: When should I tell my employees about the sale?
A: Although it sounds cruel, our considerable experience has proven that it is best to tell your employees about the sale after the sale is complete. Of course, if there is an employee whose expertise will be needed after the sale, you should introduce the buyer to this employee shortly before closing. Your Sunbelt advisor can assist you in determining the timing for notifying employees.
Q: Does Sunbelt eBusiness Advisors financially qualify the buyer?
A: No. We typically ask for a financial statement from the buyer and get an authorization to run a credit check, but we do not verify the information submitted or run credit reports on buyers. It is your responsibility to do whatever you feel is appropriate in regards to qualifying the buyer. Generally, if the buyer has sufficient funds for the down payment and for working capital, that is adequate qualification.
Q: What can I do to help sell my business?
A: As Sunbelt begins the process of selling your business, there are several things you can do to help us:
- Keep normal hours.
- Conduct business as usual. Do not let inventory levels dip below normal.
- Keep the website updated with fresh content.
- Provide us with required information in a timely manner.
- Be as accommodating as possible in setting appointments to speak with buyers.
- Work with us and not directly with potential buyers. Always refer buyers to us.
