Pre-Sale Due Diligence when Selling Your Business

You never know when you might sell your business therefore you should always be doing due diligence so you are prepared to sell your business when the time comes.  In fact, continuing internal due diligence should just be a part of your businesses operating procedures. 

If you are Considering Selling Your Business? Please click here for a downloadable e-book, “ 10 Ways to Increase the Value of Your Business“.

Vasilios Peros,Esquire ( recently wrote an article on the importance of pre-sale due diligence when selling your business.

There are many reasons why you might not know when you are going to sell your business including:

  • Health reasons for you
  • Health reasons for a loved one
  • Loss of larger clients or changing market
  • Loss of key people
  • Surprise offer that might make sense
  • Need to re-capitalize
  • A growing aversion to risk
  • “Just Can’t Take it Anymore”

Mr. Peros states, “In conclusion, pre-sale business due diligence is critical to achieving a high sales price and favorable terms.  Surprises resulting from a potential buyer’s due diligence can be detrimental.  Accordingly, pre-sale preparation and due diligence should be made a part of normal operations of a business.  With some budgeting and planning, issues identified can be resolved over a period of time and not at the last minute before a sale.   The outside advisors of the business can perform many of these pre-sale diligence tasks, allowing owners to focus the majority of their time on running their business.”

Click here for full article on due diligence when selling your business.

Greg Caruso

Harvest Business Advisors

Business Brokerage  |  Business Valuation

Maryland  |  New Jersey

Sell my Business – For Business Owners – Do You Really Want to Sell Your Business?

Maximum Machine’s owners said they wanted to sell their business.  The idea was that a new Buyer would move the business freeing up the building owned by Maximum’s owner.  Maximum’s owner would then rent the building for significantly more money to a retail user.     The building had valuable retail  zoning on a high-traffic corner.   Maximum paid below market rent.  Even adding the rent paid by Maximum back to  Maximum’s cash flow did not generate the cash flow renting to a retail tenant would.

Unfortunately, the owners refused to price the business anywhere near the market value and, at last count, were still running their business making less money than what market rent would generate.

If you really do want to sell your business,, the following will help.

Considering Selling Your Business? Please click here for a downloadable e-book, “ 10 Ways to Increase the Value of Your Business“.

The moral?

People run businesses for reasons other than money;  and in the case of Buyers and Sellers, actions speak louder than words.

Gregory Caruso, JD, CPA, CVA
Harvest Business Advisors
Business Brokers, Business Valuations
Maryland | New Jersey | Pennsylvania