You will begin preparing for sale well before you put your business on the market.

This could include:

  • Making sure you document processes and policies, making it easier for the new buyer to operate the business.
  • Ensuring employees have documented job descriptions.
  • Obtaining written agreements from suppliers and review contracts to make sure they don’t expire during the sale.
  • Selling obsolete or slow moving stock.
  • Reviewing plant and equipment and selling anything not required.
  • Making sure premises are well presented.
  • Reviewing your lease agreement to ensure it doesn’t expire during the sale and includes provision to transfer the lease to a new owner.
  • Collecting outstanding debts and paying your creditors.
  • Obtaining audited financial statements for at least the previous three financial years.
  • Reducing employee leave liabilities by encouraging them to take leave, if possible.

Potential buyers will want to undertake their own due diligence into your business. However, it is a good idea to prepare a buyer’s information pack outlining key information about the business and what is included in the sale.

As a general guide the pack should include:

  • confidentiality agreement
  • description of your business
  • customer or client profile
  • industry information including how your business performs against industry benchmarks
  • detailed list of business assets and their value – these may include documented procedures and systems, plant and equipment, stock, intellectual property, client list, lease information, employees’ skills and qualifications, key business relationships and contracts.
  • testimonials from suppliers and customers
  • audited financial statements for at least the previous three financial years
  • offer and acceptance form
  • contract of sale.