As long as you follow the right legal steps, anyone can sell a business - including you. But do you have the time and the skills to get the best outcome? Can you take the risk if something goes wrong? We list the top five groups we deal with when someone asks who can sell my business.
What licenses are required to sell my business?
In reality there are no licenses, qualifications or certificates required to sell your business. If you are lucky enough to agree on a good deal, the contractual arrangements are simple and the transaction has no complications then you can do it yourself.
A business broker license allows that person to act on your behalf - to act as your agent. The broker is free to approach buyers independently of you as long as they are acting under your instructions.
A lawyer is also able to act as your agent, on the basis that they have been trained and registered to act on behalf of their clients.
That said there are a range of legal issues that can become very complex to deal with, and it is highly recommended you seek some legal advice if you choose to sell your own business.
A good introduction to the issues that often require legal advice are covered in the blog posts by LegalVision:
Can I sell my business?
Yes - you can sell your business. But you are taking on all the risk if anything goes wrong. When it comes deciding between the different answers for who can sell my business, this is the option with the most risk.
Can you:
Effectively promote the business to a group large group of buyers?
Prepare a professional presentation demonstrating the key features your buyers are wanting?
Negotiate a deal confidently?
Answer all the questions necessary and collate the required information from the due diligence process?
Execute the deal successfully dealing with all legal issues?
Ensure you only pay the right amount of tax?
More importantly can you do this whilst managing the business and not allowing the sale process to impact the performance of the business?
Remember you are taking on all the legal and financial risk of the entire sale process, so you need to be confident you have all the answers.
Who can sell your business?
In most cases the first person that people think of in selling their business is a business broker. In reality almost anyone can sell a business, but many will not have the experience, the systems nor the networks to make the process run smoothly, get the best outcome and protect the vendor from risk. The key groups of people that can sell your business include:
Do it yourself
Accountants and lawyers
Business brokers
Merger and acquisition advisers
Other exit strategy specialists
1. Do It Yourself
As we have implied in the above comments, this method is not normally recommended, but sometimes it is suited to some businesses.
For small businesses that lack complexity, have financial reports that demonstrate good results and lack the funds to use a full broker or sale service the DIY process can be a good option.
In this case you can list the business on a range of websites to promote the business, develop your own executive summary to describe the key features of the business and do the legwork yourself in fielding calls or approaching other potential buyers.
I recommend this process where you can get advice from a lawyer or accountant at different times and there is an acceptable level of risk from things that may go wrong.
Kerr Capital has an excellent DIY Business Sale Program that I highly recommend to support this approach. They have had a lot of success with small business owners finding a buyer, and a reputable broking firm is also there to provide support where required.
2. Accountants / Lawyers
Accountants and lawyers often get asked "can you sell my business", and it is not uncommon for these professionals to execute a sale process. However, often the business owner needs to bring the buyer and at least a letter of offer for the deal to proceed.
There are some cases where an accountant or lawyer will have an existing network that they can promote the business, although they are not always experienced in preparing a professional business profile, executive summary or information memorandum.
However in many cases accountants and lawyers regularly facilitate or lead transactions for their clients. They have a ready made buyers network, that often includes private investors and high net worth individuals.
Good examples of these type of accountants include:
Most commercial lawyers have extensive experience in most aspects of the sale of a business, but not all will have the potential buyer networks. Some will have a network of private clients and high net worth individuals that may be potential buyers, but in most cases they will rely on the identification of potential buyers and approaching them. For well prepared businesses that are profitable and have a strong
Examples of efficient and experienced commercial lawyers include Peter Moran of Peer Legal.
Regardless of whether you use your accountant or lawyer to manage the deal, I strongly recommend that you get advice from both these professions along the way. Especially in the area of legal risk and taxation advice. Do not go cheap on getting advice in these areas.
3. Business Brokers
Business brokers are an effective way of reaching the most people, in the best way using established systems they use everyday. So to get a fast sale it is worth talking to a few brokers and picking the right one. Sometimes you can find a broker that will specialise in particular industries such as cafe's, restaurants and hotels.
Each broker will have particular areas of expertise and focus - so it is important to ask them Some of the business brokers that we can recommend include:
Michael Kerr of Kerr Capital - he is the most ethical brokers I know.
Emil Parthenides of EP Advisors (0412 817 059) - he has deep and very successful experience in food processing, hospitality and wholesale distribution industries.
Mark Hall of Finn Group - he has experience in many small business, including retail and trades industries supported by a large broking system.
In most cases a broker will have the right documentation and able to do most of the leg work in executing a deal. In some cases you will need specialist legal or accounting advice.
4. Merger and Acquisition (M&A) Advisers
M&A Advisers are specialists with deep transaction experience, often from large merger and acquisition activity with ASX listed companies. They typically have experience with tier 1 or tier 2 accountants / consulting companies. In most cases they deal with businesses with a business valuation of $10m or more, although specialists will work with smaller businesses.
They typically start with a review of the business and then spend 12 months or more working inside the business aimed at increasing the value of the business and positioning it for sale. This time is also spent attracting buyers and negotiating a deal.
An example of such an M&A specialist is Julian Thornburn of Canterbury Partners. Canterbury partners has extensive experience dealing with large corporate entities and a range of privately held businesses of different sizes. Their corporate network often means they can develop a strategic sale offering that cannot be developed by smaller players.
5. Other Exit Strategy Specialists
We often have clients ask the question "who can sell my business"? Especially after a business valuation has been completed.
After spending more than 10 years consulting in the exit strategy and business valuation area, and a further 8 years in the business consulting industry, we have come across a wide variety of specialists that have very innovative offerings.
Many coaches and business consultants have had past experience building and selling their own businesses and find they have built up a network and a set of skills that not only help business owners improve their business but also find the right exit strategy.
Kerry Boulton of The Exit Strategy Group has done this, written a book about it and provides business exit plans to help business owners exit their business.
Past executives and senior management of large corporate companies also have a depth of experience and networks that can tap into solutions when it comes to selling your business. Sean Walls of Genesis MX Consulting is a dynamic example of someone who can help you restructure your business, turbocharge its growth and then introduce you to the right buyer.
Sean's focus is to deliver fast and dramatic growth so that your business will attract a strategic buyer that is likely to pay a market premium.
Exit Value Advisers has also worked with many business owners helping them increase the value of their business and finding the right exit strategy that gets them the best price.
We often do an initial review of a business to see if they are prepared for sale, specifically answering the questions:
Is the business likely to sell?
What is the likelihood the business will attract a premium?
If you want to learn more about your exit strategy options or get a business valuation then contact us for an obligation free discussion.
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This article effectively answers the question of who can sell your business, business brokers offering valuable insights and guidance for business owners looking to navigate the complexities of the selling process.
I find this article to be a valuable resource for business owners considering a sale, as it offers clear guidance on the crucial role of professional intermediaries in selling a business, emphasizing the expertise and assistance that brokers bring to the process.