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Take the Right Steps for a Successful Sale

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Proper Advice & Preparation Pays Off

Selling a business is one of the most important financial decisions in a business owner’s lifetime. Given many baby boomers’ desire to retire and sell their businesses, as well as the current low interest rates making buyers’ access to financing relatively inexpensive, now may be “the time” for business owners to sell and “get their price.” 

Selling a business should be a planned and controlled process of making a business attractive, marketable and profitable. The actual sale transaction is just a part of the whole selling process. The secret to netting the most value from the sale of a business is for business owners to carefully manage and nurture the business while taking the proper steps and time to prepare for the sale. Mindful consideration of the following may be helpful to attain greater success by way of preparation:

Form a Team of Professionals

Business owners are experts in operating businesses but not in preparing businesses for sale. Some sellers are reluctant to hire business brokers and intermediaries or seek assistance from their attorney, banker and accountant to prepare for the sale of their business. Many business owners unwisely focus on fees and short-term costs as opposed to long-term net-value, thereby losing bottom-line benefit from sale, increasing liability exposure and risk of overall sale and post-closing failures. Business owners using a team of dedicated and well-coordinated professionals should attain the best sale and post-sale results. 

Plan Well in Advance

Abraham Lincoln said, “Give me six hours to chop down a tree and I will spend the first four sharpening the axe.” Just as home owners “stage” their houses before listing them for sale, business sellers should take steps to make their business more attractive to buyers. Savvy sellers and teammates take the time well in advance of sale to identify potential internal and/or external buyers, determine what a buyer desires and make the appropriate changes to fulfill those desires. Making the desired changes takes time and proactive planning is needed to be ready to strike when the business owner chooses. Some common planning considerations:

  1. Decrease the business owner’s participation in day-to-day activities by hiring, delegating or training others to handle the owner’s operational processes
  2. Address customer and supplier concentration issues
  3. Increase revenue, positioning and value by locking down existing customers or suppliers with long term contracts and investing in consultants and salespersons to increase market share and operational efficiencies
  4. Execute employment agreements, buy-sell agreements, non-competes, and restrictive covenants with co-owners and key employees
  5. Establish or maintain solid and trusted banking relationships to facilitate third-party financing and prepare the seller/owner’s personal financial planning for anticipated seller-financing concessions
  6. Review business-level legal and tax structuring, compliance and operations. Examples include entity structuring and protecting intellectual property such as core know-how, customer lists, patents and unique operating capabilities
  7. Settle outstanding litigation threats or issues
  8. Review personal-level estate and income tax exposure as well as asset protection planning
  9. Eliminate any potentially suspect or gray area business and tax practices
  10. Address accounting practices, controls and tax records to provide credibility to purchasers by way of audit, review or compilation attestation services
  11. Disengage cash flow drains such as unprofitable or slow-paying customers and address the collection of accounts receivable
  12. Document key operational processes and invest in modernized computer systems to better fit potential buyer processes
  13. Address business and personal goodwill considerations
  14. Secure third-party leases, contracts and the like
  15. Discard useless inventory

Kelleher & Buckley, LLC can help you plan, prepare and execute.  For more information on how we can assist you, please contact one of our corporate attorneys at (847) 382-9130 or email

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