7 easy steps in selling a small business

By Admin | 16 Sep, 2020

7 easy steps in selling a small business

7 easy steps in selling a small business

Easy steps to make your small business more saleable and generate maximum value for it.

Selling a small business is much easier as compared to bigger business. The risk and capital required to buy a small business is relatively low hence making is more desirable. However, in our professional career we have observed that many small businesses don’t get what they ask for. The reason is simple, they have not made the business saleable. 

7 steps on selling a small business profitably and faster 

1. Make up your mind 

Be sure about your decision to sell your business. Buyers don’t prefer businesses which are up for sale to test the market and are not for actual sale. This also involves planning your life after retirement/ sale of business. We are talking about not going to work where you have spent the majority of your time.

2. Get the house in order

Make sure the tasks that are dependent on you are completed. Set the processes for work as much as possible. Communicate to the employees how things will work.

3. Furnishing and files in place

Clutter anywhere is not pleasing to the eyes be it home, office or garden. Apply the same thing in your business. You do not want the buyer to visit your office and see clutter of unfiled documents and bad furniture. Taking care of basic cleanliness goes a long way in selling a small business easily.

4. Accounting and invoicing

Keep your books up to date. Bill the customers you want to, keep the receivables ready along with the follow up schedule. The last thing you want is a dispute with the buyer over unbilled revenue.

5. Clear communication to clients

Some day or the other your clients will come to know about the sale of business. Having clear communication with the client will help in continuing the relationships even after the sale of business. Communicating with the clients also helps in building their trust and relationship with the new buyer of business. If the buyer is happy, you are compensated for it by greater value.

6. Have a transition plan ready

When it comes to selling a small business all you need to do is Plan, Plan and Plan. Keep the plan ready on how clients will transit from you to the buyer of business? How much time will be taken by clients if they are on retainership basis? How will employees make the transition? Can things be managed in your absence? If the answer is yes then you have a transition plan in place. Nothing pleases buyers more than a clear transition plan.

7. Know the selling cost

Selling a small business comes with costs like consultant fee, tax on capital gains, marketing cost etc. Keep the provision of selling cost in your budget so that it is not taken out of your retirement fund.


8. Patience is the key

Have patience when you plan to sell a small business. Things don’t happen overnight. You have to be patient and vigilant when you sell your business. We always recommend starting your process approximately 3 years before you plan to exit.