Advisors Offer Tips for Avoiding Major Pitfalls When Selling a Firm
Selling a business or having it change hands among family
members is a common occurrence among kitchen and bath
However, there are a number of major pitfalls in selling that should be avoided at all costs, business advisors say. Among them are these:
- Continue to mind the store and keep a close eye on everyday
business during the negotiating process, which may take six months
- Stay focused. Have clearly-defined objectives, and be prepared,
decisive and confident.
- Involve advisors and objective, experienced third
- Keep your emotions in check, remembering that selling a
business is like riding a roller coaster. There will be a lot of
ups and downs.
- Don't worry about what someone else received for his or her
business. Concentrate, instead, on the sale of your own business.
Remember, too, that the highest "bid" may not be the best deal. All
aspects of the transaction must be examined.
- Take your time; don't be in a hurry.
- Share good news and bad news about the business. Don't hide
- Set your expectations realistically, so you won't be hurt or
disappointed if you don't get what you want. Often, businesses are
sold, or otherwise passed along, to family members who've been
associated with the company in some capacity. The following are
steps for ensuring a smooth family business succession:
- You must have motivated and knowledgeable
- You must have an organized team of managers.
- Develop a group of competent advisors.
- Develop a straightforward ownership structure.
- Be sure you have full and open communications among family
- Consider an outside Board of Directors.
- Be sure the seller has a meaningful retirement plan.
- Do careful estate planning well in advance.
- Solicit outside help in determining a fair value for the business.