Frequently asked questions about selling my business
How long will it take to sell my business?
The average is 4-8 months from inception to closing. Once the business is officially listed, the confidential marketing campaign is activated on a large number of specialized websites and social networks. Soon, some potential buyers should approach the broker to inquire about the advertised business opportunity. Once the prospect has signed a confidentiality agreement, they will be entitled to receive a confidential memorandum of sale prepared by the broker. If the prospect likes the business, they will submit an offer to purchase that includes their terms and conditions for the acquisition. At that point, the prospect will have a period to check facts and figures, review the financials, and make sure that the information on which he based his offer is truly accurate and truly representative. This period, known as the due diligence period, or “due diligence” in English, generally lasts from 15 to 45 days, depending on the nature of the information to be reviewed. If the prospect is satisfied during the review period, then the attorney or closing agent may begin preparing the necessary documents for the closing of the transaction. This final stage takes a period of no more than 10 calendar days.
How is the confidentiality of the sale maintained?
At BBF, Florida's trade brokerage association, we are strict practitioners of strict confidentiality standards in every transaction. We understand the damage an information leak could cause to a seller's business. Consequently, the broker's practice must consider the serious responsibility of maintaining secrecy at all levels of the transaction. Any serious prospect must sign a confidentiality agreement to protect the seller's interests, before receiving detailed information about the business.
Why hire a business broker?
The first step in selling your business should be consulting to a business broker to find out the formulas they will use to approximate the most convenient selling price to place your business on the market. The alternative of selling the business yourself could be difficult because you would have to learn a series of methodologies that would absorb valuable time and distract you from your routine business functions.
When a business owner hires a broker, he can have the peace of mind that he will be able to dedicate the bulk of his time to continue operating his firm while the broker fulfills the management that has been entrusted to him.
How much does it cost to hire a business broker?
The remuneration of business brokers is usually subject to the results of their professional management. The seller will pay a commission to the broker only when the sale process is completed, on the day of the closing of the operation.
How does the broker attract potential buyers?
By entering the information into our system, your business will be advertised in a referential manner on around 22 different specialized websites and social networks in such a way that potential buyers will only know details of the operation once they sign a confidentiality agreement. Through direct marketing our specialists will access specific sectors of buyers and through advertising in local newspapers, to the general public. To guarantee the confidentiality of each operation, all marketing efforts will exclude the name of the business.
Does the business broker qualify the buyer?
Once the potential buyer has signed the Confidentiality Agreement, we invite him to fill out a form with his personal information and patrimonial data in order to know his business inclination and his financial capacity. However, our team does not verify the accuracy of the information provided, so we always advise the seller to require the necessary certifications from the buyer.
Should the Seller finance part of the sale price?
Most business sellers prefer to receive the full price at the time of closing. However, there are sellers who prefer to finance part of the price for tax reasons and to receive higher interest on the credit granted than that paid by banks on deposits. In addition, buyer financing increases the number of prospects willing to purchase the offered business. The seller who agrees to finance the buyer will reflect in a promissory note (promissory note) the terms of payment and the guarantees offered by the buyer. The closing attorney will prepare these documents and fill out the UCC-1 form that officially registers the lien with the local authorities.
What is the best time to sell my business?
The time to sell is given by the particular circumstances of each business owner. A common case is that of the owner who has spent many years running the business and wishes to retire. It often happens that the successors of that businessman are not willing to assume his responsibilities and he will have no other option but to sell his business. Other reasons such as problems with partners, divorce, or illness force the unexpected sale of the business. However, if we apply rationality to the sale, we will see that the best time to sell at the best price is when the company is doing well and can reflect adequate financial results.
In any case, the business broker will advise you on the formulas to prepare the business sale memorandum and how to prepare the company for the market launch process.
If you have any questions that are not answered above, you can ask them in this form.