You have finally made the big decision to sell your business. Ideally you are in a great position and you have the 6 to 12 months or more necessary to market and sell – but that is not always the case.

It is extremely important to be honest with your broker. I am not here to judge. Your honesty gives me the information necessary to properly market your business and the proper pricing to meet your required timeline.

Two recent examples come to mind. With some upfront knowledge of the situation, we may have been able to properly structure and sell the businesses in these cases.

#1 – We accepted a listing for a retail based business that appeared to be profitable. I conducted our selling interview, did a proper evaluation, and gave my opinion of value and average sale time. As always I asked the time frame to sell and if there were any extenuating circumstances I need to know about, and the answer that followed was “no”. A few months into the listing I started receiving pressure to sell the business quicker than anticipated. After several discussions it was revealed that the business had not paid rent for months due to the seasonality of the business and several other personal factors.

It’s a very attractive business to buyers and there is not a question that I could have sold this – but within a few weeks of being notified of the rent situation I was told the landlord was looking to take the location back.

If I had known this, just as an example, we could have approached strategic buyers and may have structured an earn-out, a note or several other ways to get the landlord his money and a new tenant. The seller would be walking away with some funds, future payments and security in all of the collateral. Unfortunately that was not what happened and the seller had to walk away from the business.

#2 – Another business owner was looking to sell and move out of the area. Florida is transient, so as always this was a reasonable response. Fast forward several months – the seller had filed for personal bankruptcy. By not informing me of the situation we went ahead and located a buyer, but were unable to complete the sale because of the bankruptcy situation.

If I had known I would have given the seller the simple advice to discuss the timing of a sale with their attorney. We would have been able to sell and they would have been able to move on.

These are clear reasons why you should be upfront and honest with your business broker. We are here to make sure we assist you in reaching your goals and knowing your situation is going to allow us to price, structure and market your business properly.

Michael Monnot

941.518.7138
Mike@infinitybusinessbrokers.com
1910 Park Meadows Drive, Suite 202
Fort Myers, FL 33907

https://infinitybusinessbrokers.com