Naturally, people want to be smart about any business for sale that they decide to approach. In this context, the more analysis and assessment that takes place, the greater the awareness about what they are going to inherit. We will walk through the necessary steps involved in this process.

Reviewing the Finances

In order for people to be smart about approaching a business for sale, it is imperative that they take a very close look at the finances of the organisation. Key documentation must be included in this analysis, featuring prominently the cash flow statements, profit and loss statements and balance sheets over the last 5 to 10 years, if not beyond. What assets are in the name of the brand, and what debts and liabilities are against its name? This is a warts-and-all examination of the company which takes preference.

Readiness for Ownership

People who want to do their due diligence with a business for sale have to recognise that this endeavour they are embarking on will be a challenge and involve a number of obstacles. Very rarely is it a case of inheriting a brand with no stress, running it exactly the same as before and encountering no difficulties. There will be anxiety, pressure and mistakes. It is about preparing for that journey and having a long-term vision of where success is found.

Taking Note of Industry & Regional Trends

Interested parties who want to be calculated with their approach to these listed brands should be curious about what is unique in the industry at this point in time. From manufacturing to hospitality, entertainment, transport and logistics, medical, agricultural, mining, education and beyond, there are special opportunities and risks that are involved with each field. Yet it will also be the attributes and risks associated with the location that plays a different role, demonstrating how competitive the enterprise stands to be in the short to long term.

Gauging Outside Business Interest

Prospective clients may not be the only individuals involved in this process. They might soon discover that other parties are just as eager or curious about the prospect as they are. If this is the case, the seller will find more leverage and attempt to engage in something of a bidding war where possible. However, if there is a lack of interest, then the leverage will reside with the buyer and may influence their appetite to buy if no one else wants in on the action.

Plan for Growth & Development

Individuals, couples and groups who want to pursue a business for sale out of their own interests cannot be satisfied taking the reins in order to continue with common practices. In 99% of cases, an entity put on the market requires some form of change, whether that is extreme or minor. This is where a plan of action needs to be engaged, setting out terms for 12 months, 24 months, 5 years and 10 years. Where do members hope to see the business in those periods, and how can it thrive amid external and internal pressures?

Carefully Checking Contract Terms

A savvy move that operators should always follow with a business for sale is to be careful in looking over and agreeing to the contract terms. In many situations, there will be operators who reach out to a lawyer or agent to check that the stipulated provisions are in their best interests. It is only once they have been double and triple-checked that pen can be put to paper.