There are many reasons why a small business owner might want to sell his or her business. The business could have gotten too big to handle for one person, might not be doing as well as the owner would like, or the business owner might simply want to cash out on the business venture that they built. Whatever the case may be, when it comes time to sell your New York business, you should consider discussing your situation with an experienced business lawyer.
Getting a business ready to be sold takes some prep work, but is well worth it since your efforts will simplify the sales process in the long-term. Below are a few things to consider when selling your New York business.
- Get your house in order. Before you can even begin to offer your business for sale, you need to know its worth. Prepare your business for a valuation so that you can have a better idea as to the price you should be asking for your business. Organization is key at this preparatory step. Putting all of your financial documents, contracts and loans in order can help you determine exactly what your business is worth.
- Make an offer for sale. Once you have a valuation, you can make a good assessment as to what price you should ask for your business. The price doesn’t have to be fixed, and you can be flexible if the prospective buyer is willing to negotiate.
- Negotiate a deal. In addition to the price, there are many other terms of the sale that need to be worked out. Financing, leasing agreements, assumption of debts or obligations, assignment of contracts, any representations and warranties you and the buyer are making to one another, etc., all need to be considered and worked out on a case by case basis (not all terms will apply to every deal). This stage is a good time to work with an experienced business lawyer to ensure that you are considering all of the aspects of a sale that are appropriate to your business.
- Buyer’s due diligence. Buyers generally want to conduct a period of due diligence in which they review the details of your business to make sure everything is in order. This can include inspecting your books, business premises, equipment, inventory, financial records, business contracts, incorporation documents, etc. It is important that you are transparent and helpful to the lawyer during this process.
- Entering into a sales agreement. Get a business lawyer to prepare the appropriate paperwork that you will need to complete the sale of your business to your buyer.
- Winding down your business. Winding down your business is an important final step in the sales process. This includes closing down bank accounts and canceling insurance policies. Talk with a New York business attorney to make sure that you wind down your business appropriately.