If you want to sell your plumbing business, it is a good idea to consider not only your main goals and objectives for the sale - the value you want to achieve, for example, and the ideal timescale, but also the reasons for selling.
Selling your business requires professional legal and financial input, but you can also take advantage of the knowledge and industry insights of highly experienced business sales brokers.
Our expert team at Selling My Business has over 30 years’ experience of assisting and positively influencing business sales, and will help you formulate a clear exit strategy. With this in mind, are there any factors that could prevent your business achieving its optimum value?
The plumbing sector has dealt with a number of challenges in recent times, not least of which was the knock-on effect from the downturn in the construction industry following the global economic crash.
Plumbing continues to face fundamental challenges, however, which could affect your business sale, so what might these issues be?
Planning an exit strategy well in advance helps you attain the value you are looking for, and provides the time to present your business in its best light. Preparation could simply involve bringing your financial records and obligations up-to-date. On the other hand, a complete rethink of your sales strategy might be required to improve turnover before the business goes on the market.
When any potential buyer completes their due diligence, they will expect the figures you have provided to be a fair and reliable representation of the state of your business and how it is performing. This is why it is important to address any operational issues proactively.
The sales memorandum is the initial document released to interested parties. It describes the business as a whole and why you want to sell it, and also includes financial documentation such as past profit and loss statements, your forecasts for sales and profit, and details of business assets and liabilities.
Your business is initially marketed by defining your ‘ideal’ buyer as far as possible, identifying interested parties, and providing them with the sales memorandum mentioned previously. Opening offers are considered, and a shortlist of prospective buyers is then made.
After further negotiations, one or two parties may emerge as likely buyers based on their own financial situation, and the possibility of them meeting your requirements from the sale.
Once negotiations have reached a certain point, a heads of terms agreement is drawn up, and your buyer will carry out their due diligence to ensure the details you have provided about your business are correct.
The buyer may wish to secure warranties and/or indemnities to protect themselves from specific or general issues that could compromise the future success of the business. It is crucial to seek professional guidance before you agree to these.
Selling My Business can provide the sector-specific knowledge and experience you need when you are selling your plumbing business. We will ensure your plans for sale are expertly handled and executed, and help you extract the value of your business in the most tax-efficient manner. Call one of the team for a free consultation.
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