7 Key Steps to Selling Your Business

February 2024

For many business owners the dream is to one day sell for a rewarding figure, but like most successful results this is unlikely to happen without putting in the work beforehand.

Having helped many of our clients prepare for, and execute, a sale these are the 7 key steps that we know pave the way for the best outcome.

1. Planning

Preparation is key to a successful and profitable business sale and seeking the right advice early on will ensure you are always taking the right steps to establish your business as a desirable purchase. It’s never too early to start planning as this only continues to add to the growth and success of your business!

2. Strategy

Putting in place your strategy from the beginning will keep you on track with the way you want to move forward. Regular monitoring and reviews will ensure it continues to align with your desired outcomes.

3. Strong Corporate Governance

Many businesses do not have the structure in place to demonstrate a history of strong corporate governance. Commonly this is done by appointing a board or advisory committee which can hold management to account and should be done early to establish a strong track record.

4. Crunch the Numbers

Cash flow forecasts and sound budgeting will be scrutinised by potential buyers. They will need you to be able to prove that you can produce maintainable profits; cash flow, and that all costs are accounted for.

5. Due Diligence

All paperwork must be in order in the lead up to a sale. This includes contracts, leases, insurances, employment agreements, processes, and procedures. Everything needs to be documented and up to date.

6. Preparation of Information Memorandum

An information memorandum (IM) is a document which describes the business, discloses business details and aims to put a value on the business. Buyers will be looking for an IM so it’s best to have one prepared before you start any serious negotiations.

7. Engage Corporate Lawyers

When it is time to sell engage a good corporate lawyer to finesse the transaction details and ensure nothing is missed.

If you’d like to talk to an experienced advisor about what getting your business ready for sale looks like please get in touch. Give us a call on 03 9325 6300 or email info@matsteer.com.au and we’ll connect you to the best person for your business.

You can read more about planning and strategy to ensure your business is always in a sale-ready state here.