Create a Compelling Story to Sell your Business

Developing a marketing package that tells your story Do you have all required documents that market the story

Developing a marketing package that tells your story

Do you have all required documents that market the story of your business?  Having a marketing package will ultimately shorten sell time and award the highest sales price. Without documentation, a buyer cannot make an informed decision about a purchase. In preparing for the sale of your business, below is a list you can use to develop a winning marketing package.

  • Interim financial statements

Interim financials show a buyer the up-to-date financial strength of a company since the last corporate year tax return filing. Interim financials are also necessary for lending institutions when trying to obtain financing.

  • Three years of tax returns and income statements

Three years of financial statements paint a picture for the buyer, on the financial stability of a company. A prospective buyer can use financial statements to analyze revenue and expense trends, determining the health and cyclical trends of the business.

  • Current asset list

When assets are a significant part of the equity, a higher sales price is easily justified. Anything above asset value is considered goodwill and is more difficult to justify. An asset list with total fair market values creates a base value for a business. If outside financing is needed for a business transfer, then an itemized list may be required.

  • Asset and Liabilities

Assets and liabilities on a balance sheet can either be transferred with the sale or kept by the seller. A buyer needs to know exactly what assets and liabilities are an educated offer. It is prudent for a seller to identify which leases and notes can be transferred before the negotiating process begins. Not taking this action could cause a deal to collapse. 

  • Facility information

It is necessary for the prospective buyer to know everything about the facility being purchased. Things to know are:

  1. Where is it located?
  2. What are the lease terms?
  3. Is real estate included in the deal?
  4. What is the square footage?

If the business is in a leased facility, it is imperative that a buyer performs due diligence to determine whether the lease terms can be transferred. Awareness of these factors can give the buyer a stronger negotiating position.

  • Employee information

The most valuable asset in addition to FF& E (Furniture, Fixtures and Equipment) are the employees. The following information should be included in the marketing package:

  1. Number of employees
  2. How long each employee has worked for the company?
  3. What is the current pay structure?
  4. How stable is the workforce?
  5. Do the employees know the business is for sale?
  6. Is the owner willing to stay on as an employee?

Employee information, without personal identifying information can be displayed using an organizational chart.

  • Company history

A chronological summary of a business will provide a prospective buyer a road map to a company’s history. A prospective buyer will be able to look at historic financial statements together with the company’s business history to perform an overall analysis. Information to know:

  1. Has a new line been recently added?
  2. Has the business been moved?
  3. When was this business formed?
  4. Is the business run by the original owner?
  5. What has been the marketing program since the company’s beginning?
  • Other information to include:
  1. Reasonable and fair Asking Price
  2. Deal Structure and Financing
  3. Is there SBA financing available?
  4. Marketing Strategies –Will aggressive marketing increase sales?
  5. Reason for selling? – Retirement, divorce or lack of interest?
  6. Industry Trends – How are industry revenues trending as a whole?
  7. Industry Trade Journal – if a buyer lacks industry experience, trade journals are recommended.
  8. Published articles – Has the business been featured in a newspaper article, or trade article?
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