How long will it take to sell my business and how long is your contract?
According to the Business Brokerage Press, the average time for the sale of a small business was 212 days from the date of listing to the day the seller received a check. At George & Company, some deals come together within 60 days, others take quite a bit longer. Due to these statistics our average contract runs from 6-12 months. Only a careful analysis of your company will allow us to more closely project the time required
Can I engage George & Company and still sell the business myself?
George & Company works with exclusive contracts only. If you have identified a potential buyer, we will arrange for a reduced success fee for that one particular buyer.
How will you market my business while maintaining confidentiality?
VERY CAREFULLY… George & Company is a trade name NEVER used once you become our client. When we contact you via email, phone, or fax, it will be “Jay from SMC” or George & Company, our parent company. We will obtain and review very specific directions on communication with you and/or your trusted staff members with whom you have confided with.
One of our contemporaries once stated that our job was very difficult because our clients want to be sold right away but they don’t want us to tell anyone that they are for sale! George & Company has dozens of methods to introduce your opportunity into the buyer community without compromising confidentiality. First and foremost is tapping into our database of over 2,200 active, qualified buyers, updated regularly by dedicated staff. Blind postings (with very broad geographic range) on tens of web sites, trade publications, national financial publications, direct mail and countless other means are utilized and only after approval of the client.
How can I figure out the value of my business?
When it comes to determining the value of your business, there are a lot of options depending on your business and industry. Business Valuations provide a look at your company in many different ways, from cash flow to physical assets. For a more in-depth look we provide our own proprietary Strategic Options Analysis. George & Co provides several options that are commonly integrated into our selling a business process.
Do my employees need to know I am selling my business?
Each company has different needs but typically employees are not told of the sale until such time that the seller and buyer agree the time is right.
Do I get to keep my cash on hand and accounts receivable?
Most business sales are asset sales where the business seller does keep all cash and receivables at closing. This is a negotiable issue that is discussed prior to bringing the company to market.
Will I need my lawyer and accountant?
ABSOLUTELY… The success of any business transfer is directly related to the team effort put forth. Your attorney and accountant will be instrumental in creating a win/win deal and should be made part of the team as soon as possible. If your attorney is not experienced in business transfers, we are happy to provide a list of experienced M&A lawyers for you to choose from. Tax implications will be critical and your accountant should be conferred with early on in the process.
How is selling a business taxed?
The sale of a business can be a complicated taxable event but does allow the seller the luxury of having the time to do things he or she wants to but can’t due to business management burdens. To successfully navigate the waters of a sale of your company it is imperative that your consult your tax professional BEFORE you sell.
Issues of capital gains, recapture of accelerated depreciation, Section 179 of the Code, ordinary income taxes and President Obama’s new healthcare taxes will all have a negative impact on what you receive at the closing table. Retaining an expert M&A advisor or business transfer broker along with your tax professional will reveal numerous mechanisms within the Tax Code to minimize the amount of taxes you will pay. If your company is organized as a regular (C) corporation, utilizing these mechanisms is even more critical. A good M&A advisor will have decades of experience structuring deals to minimize the taxes paid by his client.
Whether capital gains, ordinary income, dividends to shareholders, or recapture of depreciation, the staff at George & Company is experienced in how to structure each transaction to yield the maximum after tax dollars to our clients. Working in conjunction with your M&A intermediary, financial advisor, or lawyer, we will propose the most cost effective and tax saving methods within recent revenue rulings to effect the lowest tax rate to you.
What are the types of buyers for my business?
There are generally three types of buyers for a business.
- The job finder is looking at replacing you as owner and operator: their motivation is employment.
- The financial buyer is looking at your business as an investment: their motivation is financial gains.
- The strategic buyer is looking to add your company to their own business: their motivation is assets.
What is the Fair Market Value of a business?
The fair market value is an estimate of what a willing buyer would pay to a willing seller, (both having equal knowledge of the business and transaction variables) in a free market, for an asset or piece of property under conditions where neither party feels pressured or obligated to buy or sell. If a transaction occurs with the aforementioned conditions the transaction price is usually the fair market value. This is not the same as intrinsic value that an individual may place on an asset, meaning what he or she feels the selling/purchasing price should be based on personal preference.
Am I ready to sell my company?
Below are a few key questions to ask yourself if you are considering the sale of your company. These questions are for your own use. You must answer honestly to aid you in determining if now may be the right time to sell your company.
- Do you have a clear reason for why you want to exit your company or was it just a bad day?
- Are you prepared to train a new owner in transitioning ownership?
- Have you planned what you’ll do with your time when you no longer have an office to go to?
- Have you had your company appraised? Will the sale be sufficient to finance your next life?
- Are you truly committed to selling if your financial expectations are met?
- Do you have ideas as to who might be the best buyer for your company?