An individual who owns a business operating in Pennsylvania may want to sell their company at some point in the future. In fact, this is one of the ways in which older generations will pass wealth to their children and grandchildren. As a general rule, it takes about three to five years to successfully prepare, market and sell a business to the right buyer.
It may be best to work with an adviser to prepare and market the company. An adviser could help a business owner create a proper valuation based on actual cash flow instead of projections based on other metrics. This person may also have insight into who the right buyer may be and take other steps to facilitate the sale. When selling a company, it can be a good idea to accept financing as opposed to cash only.
Doing so can result in getting an offer that is closer to an asking price. Specifically, owners will receive on average 86 percent of their asking price if they allow for financing of some kind. However, those who don’t only receive an average of 70 percent of the asking price. In addition, the structure of the sale can play a role in determining how easy a company will sell and get top dollar.
The sale of a business could have many different components. Therefore, it may be a good idea to conduct a sale with the assistance of legal and financial professionals. An attorney could review an offer to purchase the business before it is accepted by a company owner. This could make it possible to ensure that the structure of the sale is beneficial to the seller from tax and other financial points of view.