subject: Understand The Facts Before You Sell Your Small Business [print this page] Understand The Facts Before You Sell Your Small Business
Out of all the decisions a business owner must face, the decision to sell is, without a doubt, the most important one.
Please give careful consideration to these two main issues, before you decide to sell your business:
1. What you want to accomplish. 1 If youre particularly anxious to remain actively involved in the business, selling it may not necessarily be your best course of action.
II) What other folks will be impacted by the purchase? It is important to consider shareholders, employees, and others taking part in your business.
There are certain particular situations and legal aspects of the business which will have an important role in selling your business. There are several ways to acquire a business and potential buyers can reasonably request that a deal take a certain structure.
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There are a variety of methods for selling a business, including a full or partial sale. For a full sale, you would sell the entirety of the business, whereas a partial sale would allow you to keep a portion of your business. For business continuity reasons, the buyer might ask you to remain involved in the business by retaining partial ownership. In addition, this gives the buyer confidence in the prospects for the business.
Instead of selling the business itself, you can sell intellectual property, equipment, your customer list or any other business asset. The prospective buyer for the business unit may be fascinated by the clean offer without any liabilities or without any type of social, legal and financial bindings. As an example, the one who makes the purchase might choose not to re-hire people who worked for you. Any assets or liabilities that aren't part of the deal will remain in your possession. Getting tax advice is vital for choosing the best type of deal in this situation.
The difference between immediate payment and phased payment is that, in full payment, the total amount is paid as soon as the sale has happened against the installment payment where payment is done in each installment. Installments may be the preferred payment method of the purchaser. If the buyer is unable to keep up with the payments, then the risk is entirely on your shoulders. There are purchasers who will desire to pay in installments based on their profits, in which even you could be under contract to remain with the business for an extended period.
