What is the process to prepare to sell your San Diego business? California business owners should understand the important steps to take when preparing to sell a business in San Diego or Southern California. Establishing and proving your company’s value to potential purchasers can be a daunting task, but with the right moves and some guidance from the Watkins Firm based upon more than 40 years of proven, successful experience you can complete a successful and profitable transaction.
Reports show that in the last five years, acquisition prices have grown by 30 percent. In this climate, business owners should be aware of some issues to keep in mind when preparing to sell their company.
Some of the Primary Steps to Prepare to Sell Your San Diego Business
First, the owners should assess their willingness to be purchased, including discussing any pertinent legal and taxation issues which could result from a sale. Are you really ready to sell your company? Are you ready to undertake the process to prepare to sell your San Diego business?
What are your goals? What do you intend to do after the transaction is completed? What will you need to be prepared for the next step in your own journey? The answers to these questions will inform the structure of the transaction yet to come.
Next, an analysis of the company’s readiness for purchase should be done. Many business owners neglect the corporate documents and the corporation itself. You want to make sure the articles of incorporation as well as the shareholders’ agreement or operating agreement are up-to-date and ready for review. Is the company in good standing with the State of California?
The primary steps to prepare to sell your San Diego business include a professional valuation of the company as well as a substantial review of your company’s books and financials. Buyers conduct extensive due diligence and ensuring up-to-date financials and accuracy while facilitating financial analysis for a buyer is one of the most important steps to take when preparing to sell a business.
An evaluation of the customer base and employees should be undertaken. What are the metrics of your customer base? Who are the central customers upon which your company depends? How are your relationships with each customer and what will be necessary to protect the ongoing business relationships during and after the sale?
Who are the key employees for your company? How do you ensure they remain with the organization through the acquisition?
Another of the important steps to take when preparing to sell a business is preparation to discuss market positioning and other metrics that will make your company attractive to buyers. A buyer will want to assess the immediate viability of your company and the post-purchase decisions, changes, actions or additional investment which may be required. Ease of integration into the existing business is a substantive concern for any buyer.
Lastly, the company should prepare a list of different exit strategies, which would include gaining an understanding of the effect each type of acquisition transaction would have on shareholders and management while preparing the company’s presentation to prospective buyers.
The Watkins Firm provides valuable insight and guidance based upon 40+ years of experience to Southern California business owners to ensure smooth mergers and acquisitions transactions. We work with our clients to help position the business for maximum value while reducing present and future liabilities and contingencies.
What is the process to prepare to sell your San Diego business. The corporate and business attorneys at the Watkins Firm will help to guide the parties through the process and ensure the transaction goes smoothly. We invite you to review our podcast Episode 13 – Mergers and Acquisitions as well as the strong recommendations of our clients and contact the Watkins Firm or call 858-535-1511 for a complimentary consultation today.
