Making the decision to list your business for sale is one of the most important choices that you, as a business owner, will have to make. Listing prematurely can lead to unexpected surprises in due diligence, lower valuation by prospective buyers, and even an inability to close the sale. We have compiled a list of 10 signs that may indicate that your business is not ready to be sold. If you are planning to sell and one or more of these apply to you, dedicate some time to resolving these issues – it will make all the difference!
You may not be ready to sell your business, if:
1 . All of the information necessary to run your business is in your head . This is especially true if you have trade secrets or other sensitive information that is key to successfully running the business. This information needs to be tangible so a new owner can access it as well as protect it.
2. The business’ financial documents are not in order and have not been evaluated by a CPA . This is a huge red flag to a potential buyer. There can be no cutting of corners when it comes to the business’ financial statements. Get your documents in order well before you ever plan to list.
3. Pre-sale due diligence has not been performed . When a potential buyer starts to look at your business, he or she will almost certainly perform their own due diligence, which will uncover any issues your business has. If the first time you learn about problems is when the buyer discovers them, he or she will have a huge advantage in