There are many reasons as to why you might want to sell your business. You could be close to retirement, have simply burned out – or just have a different passion. When buying or selling a business, there are lots of things that you need to take into consideration, which we have outlined below.
How the Business is Split
If you are the only owner of the business – it won’t be too much of a consideration as to how the business is split up. However, if this isn’t the case and you are part of an organisation where there are other owners, it needs to be clearly thought out as to how things will be split up. Usually there is some kind of shareholders agreement in place that would state what should happen in that instance, but you need to think about what would happen if your partners would rather not sell.
Capital Gains Tax
It’s easy to get carried away when you are first made an offer for your business, and you may already be thinking about how you are going to spend it! However, what you need to remember is that you will also need to pay capital gains tax on the money that you are making on the deal. When you get an offer, you can use a capital gains tax calculator – to see how much that would be.
How you are Packaging your Business up
Remember that your business comes with assets – it doesn’t just come on its own. You need to remember that they will then likely become part of the transaction. Due to this you need to think carefully about how you are going to package your business up to prospective buyers. This can be something that isn’t outlined effectively when looking to buy or sell a business, but there are professionals that can help.
Getting the Team Ready for the Change
It’s easy to forget that the sale of a business isn’t just about you – it’s about employees too. In order to make the transition as easy as possible for them – you need to put the correct change management processes and procedures in place. Let them know if there are any planned redundancies, if you think that the prospective buyer will keep them on etc.
What you will do After the Sale
You might think that after the business sale, that you can just sail off into the sunset – but you need to think clearly about what your life will look like post-sale. Will you want to re-invest in a different kind of business venture? Do you want to move away and have a different kind of lifestyle? It’s essential that you know that you will be kept busy and how you will support yourself.
If you are considering selling your business – make sure you take all of the above on board and choose what you are doing wisely.