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Selling My Business are professional business sales brokers and industry specialists

How to sell a Wholesale and distribution business

If you are selling a business in the wholesale and distribution industry, it is important to address any issues that might devalue your company. Thorough planning and preparation, as well as professional guidance and support, are key for a successful sale.

Using business sales brokers with experience in your industry will help you to reach your overall goals and can be instrumental in achieving a lucrative outcome whatever your reasons for selling.

Selling My Business are professional business sales brokers and industry specialists. We offer a wealth of experience to guide you through the process, and have detailed knowledge of the industry, its challenges, and opportunities.

What are the main stages of selling a wholesale and distribution business?

  • Sales Memorandum
    Initially you will need to supply a sales memorandum to any interested parties. This document sets out the reasons why you are selling, and offers an outline of your business, including financial data and information on your customers, suppliers, and employees.

  • Negotiations
    It is advisable to protect this information by drawing up a thorough non-disclosure agreement to be signed by anyone requesting the sales memorandum. Once you have narrowed down those interested in your business to one or two potential buyers, negotiations can begin in earnest.

  • Heads of Terms and due diligence
    A heads of terms agreement is drawn up, and the prospective buyer carries out a due diligence process whereby the information you have provided is checked for accuracy and reliability.

  • Sales agreement
    They may demand a number of warranties and indemnities to protect their investment in the future. Once all terms are agreed, both parties sign a final sales agreement.

How can we help with the sale of your business?

Identifying potential purchasers
We will identify prospective purchasers via comprehensive market research, review of relevant databases, and by placing a confidential business profile on business sales websites we trust.

Managing negotiations and more
Our team will deal with enquiries from interested parties and ensure a detailed non-disclosure agreement is signed prior to releasing information about your business. We manage the process from beginning to end, including the signing of a heads of terms agreement by your preferred buyer.

Completing the deal

Towards the end of the process we will manage the final negotiations, legal procedures, and arrange for the provision of tax advice where necessary.

 We also help you deal with the inevitable delays and drawbacks that occur during such complex processes. The industry-specific challenges you face in day-to-day business can derail a sale if not addressed and managed, so what issues might your buyer highlight?

A changing market

With advancing technology allowing online access to wholesale marketplaces, there exists a risk of being cut out as intermediary between manufacturer and retailer. It is also technology that can provide an answer, however. Yours is an ever-changing market that requires regular investment, agility, and recognition of the need to evolve. If you have not invested in specialist software such as vendor-managed inventory, prospective purchasers could view the business as having limited scope.

Fluctuating fuel costs

The industry’s reliance on fuel price inextricably links it with profitability. Fuel represents a major operating cost for wholesale and distribution companies, and although larger organisations may be able to pass on this cost to their suppliers, it is not always possible for smaller companies to do so.

Health and safety issues

Health and safety is of paramount importance in the wholesale and distribution industry where storing, handling, and transporting goods is at its heart. By its very nature this industry is dangerous for workers, and any previous significant health and safety issues may cause a prospective buyer to devalue your business.

Demand for faster delivery

The fact that larger retailers are able to demand stricter terms, faster delivery, and issue greater penalties for delivery delays or inaccurate information, places significant pressure on wholesale and distribution companies. Robust, integrated systems and processes need to be implemented to deal with the new standards and prevent customers from choosing competitor companies. 

If you would like more information about selling a business in the wholesale and distribution industry, our team of experts at Selling My Business can help. We are industry specialists and understand the challenges you face. Please contact us for a free initial consultation to find out how we can help.

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