subject: Where to Find a Buyer for Your Small Business [print this page] Where to Find a Buyer for Your Small Business
If you are in the market to sell abusiness, you will also have to do some careful planning if you want to find the right buyer, and this will require both time and effort on your part. Here are some basic steps you can take in order to reach prospective owners:
Create a list of all the positive aspects of your business that set you apart from your competition, and present a copy to any serious investor who arranges to meet with you. This document should include your client list, the equipment that you own or lease, outstanding referrals, and the special software you use. If you own the land as well, make sure that you have clear title to it, and ask your accountant to verify your financial statements before presenting them to anyone.
You will also need to write a selling memorandum that includes an executive summary and other pertinent information, the products and services you provide, your staff, your major assets, and possibilities for future growth and expansion. This will tell potential buyers what the business is really like, and help them decide if they want to proceed with the sale.
Do an analysis of your competition to determine if someone might be interested in acquiring your company. For example, they may need a good location in your area or decide that they want to tap into your customer base. Think of every possible reason that your business might be appealing to them, and be prepared to express it.
When you settle on the most likely prospect among your competitors, have a face-to-face meeting with the owner and agree that confidentiality will be respected. Present a valid reason for selling, and if the other party wants to go ahead with the sale, request a letter of intent.
If none of your competitors make an offer, consider approaching other companies in your state or county that are in the same industry as yours. They might be interested in expanding with a new location, and glad to know that your site is available.
Today, the internet is also a popular way of letting others know that you want to sell your business. You can reach a vast audience by advertising there, and of course, those closer to home will also have easy access to the information you provide.
Note that expecting a lump-sum payment for your business may be unrealistic because about 90% of the small- business sales being negotiated at this time involve a certain amount of seller financing. However, you will need to proceed with caution because, with a long-term contract, you will be assuming a substantial risk, and payment of that loan will be based on the future success of the company, which is always an unknown quantity.
