The Business Sale Checklist
Posted by Kipp Krukowski on Wed, Mar 16, 2011 @ 09:50 AM
Are you considering selling your business? I don’t mean selling your business today, next week, or even next year, I mean are you considering EVER selling your business? If so, the check list below will be quite helpful.
As business brokers we see lots of deals come to a screeching halt because the buying party finds out something about the selling party that is “less than appealing”. These issues usually come up in the finer details of the deal or in the nitty-gritty of due diligence. If you want to make your company more attractive to any potential buyer, ever, then examine the list below and make sure you’ve got all of your bases covered.
- Corporate Records – Every business needs clean corporate records, and I’m not referring to accounting, that is another matter all together. Corporate records are the board of directors meeting minutes, shareholder agreements, buy-sell agreements, and other pertinent documents that every corporation needs to have on file and current. Each form of legal entity (partnership, corporation, LLC) has their own set of specific records and agreements that should be maintained depending on the specifics of the situation. If you’re not 100% positive that your corporate records are in tip-top shape then contact a local business attorney for a corporate records audit.
- Employee Matters – Employees are one of the most valuable assets any business has – they perform the work of the business! Employees can also be one of the largest liabilities for a business when claims of harassment or injury are brought forward. Do you have an employee handbook? Do you have written employment agreements with every employee? Do your key employees have non-compete agreements or golden handcuffs to keep them from leaving? What is your history with the bureau of workers compensation? Business buyers want to acquire businesses with clean employment records. Consult with an HR or staffing consultant to ensure that you are doing everything you can to reduce your employee risk.
- Intellectual Property – Does your company have a valuable name brand? Did you invent a widget that changed your industry forever? Do you have a trademark on that name brand and a patent on your widget? Without good intellectual property protection your business is worth significantly less to a potential buyer. Work with your Intellectual Property attorney to ensure that every valuable non-tangible asset your company has is legally protected. You will sleep better with these protections in place and your offer letters at the time of sale will be much higher to boot!
Written by: Kelcey Lehrich, Business Intermediary, Confidential Business Sale, Inc.
