In the heat of negotiations and in anticipation of potential receipts and new horizons it is all too common for those selling their business (whether in whole or in part) to lose perspective as they get drowned in professionals and legal and accounting paperwork.
Here are ten tips for those about to embark on the process:
- Work out what you really want – it might sound obvious but being realistic about the financial and personal outcomes at the start will help you focus and give you a psychological line in the sand from which to negotiate.
- Don’t get side tracked – being adaptable to changes is good but be clear about the terms of the deal from the outset and don’t be talked into something that ends up looking materially different to what you originally agreed.
- Be confident but also realistic – the buyer wants your business but in most cases not at a value which is unsupportable.
- Keep perspective – it can be a very stressful process and you will run the full gamut of emotions from elation to despair. Yes, it is very important to you but not worth ruining your health for or jeopardising your future well-being.
- Don’t believe it will happen – Really? Well no but try and convince yourself that you are quite willing and able to carry on as before if it all falls through – easier said than done but it may help you to make better decisions.
- Pace yourself – it invariably will take longer than originally expected and you need to plan accordingly.
- Don’t kid yourself that everything will continue as before – generally our advice is that sellers should avoid all but the shortest interim involvement with a business they have sold. Every buyer will have their own views about how to improve your business and you don’t really want to be there while they are trying to do it.
- Choose your fights – take the advice from your solicitors/accountants but be clear about your ‘redline’ issues. Choosing them too soon could make it harder to argue the really important point when it does arise!
- Remember cash is king – earn-outs are the buyer’s favourite form of consideration and years of experience dictate that they very rarely work as expected.
- Find your Zen – in the heat of negotiations it is all too easy to lose perspective. If possible try and recognise that moment and withdraw and re-group.
For a confidential discussion about selling your business please contact Hugh Murrell on 01872 226995 or firstname.lastname@example.org