The Process of Selling a Business – It is imperative that the Seller has the opportunity to approve each aspect of the transaction, including precisely what information is disseminated and to whom, the identities and qualifications of prospective Buyers, and whether or not to ultimately sell the company.

  1. Seller agreement as to valuation, timing, documentation, and type of transaction. The first step is for the owner to decide if he or she wants to or has the time to run the deal or have an intermediary in charge of the process.
  2. Confidentiality and non-disclosure agreement for prospective buyers.
  3. Plan and methodology for marketing the business to buyers.
  4. Introductory summary (1 to 2 pages) about the business without its identity, including type of sale (i.e., stock or asset), anticipated pricing, and stance on seller financing.
  5. Screening and qualifying buyers – financial v. strategic; develop a plan to systematically identify, approach, and initiate discussions.
  6. Coordinate lawyers, accountants, etc.
  7. Information dissemination – which qualified buyers get what information.
  8. Assemble due diligence material – organize and update.
  9. Conduct visits to Your Company’s premises.
  10. Visit buyers at their premises.
  11. Structure and negotiate the transaction.
  12. Purchase and sale agreement – coordinate with attorney.
  13. Close the transaction.
  14. Post-closing

What to prepare:

Comprehensive Business Review

[The CBR will contain some, all or variations of the following, depending on the characteristics of Your Company. The CBR will only be released to qualified prospective buyers or investors after they execute a standard confidentiality agreement.]

Sample Table of Contents
Executive Summary A
  1. Business Description and Highlights
  2. Unique Attributes
  3. Proprietary Products / Services
  4. Barriers to Entry
  5. Investment Highlights & Reasons
  6. Reason for Sale
  7. Financial Summary & Capital Requirements to take Business to the Next Level
Valuation Summary B
  1. Approaches
  2. Synergy
  3. Deal Structure
Business Description C
  1.  History
  2. Company Reputation
  3. Division Structure
Organization D
  1. Organizational Review
  2. Organizational Structure
  3. Management
  4. Staff Personnel
  5. Organizational Culture
  6. Ownership
  7. Organizational Chart
  8. Board of Directors
  9. Employment Environment
  10. Talents of existing and remaining personnel – management, salesforce, administrative, training systems, etc.
Manufacturing & Distribution E
  1. Manufacturing
  2. Supplier Profile
  3. Channels of Distribution
Products & Services F
  1. Niche
  2. Uniqueness
  3. Product Line
  4. Proprietary Products, Services and Technology
  5. Products Patented or Pending
  6. Research & Development
Marketing & Sales G
  1. Industry Profile – structure & growth
  2. Market Profile
  3. Geographic Market Factors
  4. Customer Profile
  5. Customer Information – major & target
  6. Markets Served
  7. Competitive Environment and Competition
  8. Marketing & Promotion Efforts
Facilities & Equipment H
  1. Real Estate Owned or Leased
  2. Equipment Owned or Leased
  3. Facilities Photograph
  4. By Department
  5. Building Layout
  6. Capacity to Grow
Prospects I
  1. In-depth SWOT (strengths, weaknesses, opportunities & threats) analysis
  2. Growth Opportunities
  3. Future Markets
  4. Catalog strategy
  5. Franchise Possibility
Legal J
  1. Environmental
  2. Regulatory
  3. Legal Issues
Financial History K
  1. Financial Analysis
  2. Same Store Sales
  3. Profitability by State
Financial Projections L
  1. Revenue Projection
  2. Key Revenue Determinants
  3. Revenue Projection Assumptions
  4. Pro Forma Balance Sheet
  5. Forecasted Financial Statements
  6. Schedules and Note
  7. Typical Store Construction & Opening Costs
  8. Model Store Budget
Exhibit 1 – Business Valuation
Exhibit 2 – Critical Value Report
Exhibit 3 – Capital Markets Analysis
Exhibit 4 – Patent Summary
Exhibit 5 – Research Sources
Exhibit 6 – Product Photograph
Exhibit 7 – Management Resumes
Exhibit 8 – Financial Statements
Table I – Projected Industry Growth
Table II – Market Mix
Table III – Product Mix
Table IV – Revenue Potential for the New Market
Table V – Annual Employment