FBP - Certified Public Accountants

Selling Your Business 2 – Choosing the Right Advisors When Selling Your Business

Written by Team FBPCPA

April 10, 2024

Selling Your Business - Choosing the right advisors

Selling a business is one of the most significant financial decisions an owner will make. Given the complexities and implications of such a transaction, surrounding yourself with a team of trusted advisors is paramount. These professionals can provide invaluable insights and support, ensuring you not only maximize your financial gain but also navigate the intricacies of the process smoothly.

1. Certified Public Accountant (CPA):

Role: CPAs play a pivotal role in the financial preparation and analysis of your business for sale.

Valuation: Assist in determining an accurate business valuation, considering assets, liabilities, future earnings potential, and more.

Due Diligence: Guidance through the due diligence process, including assistance with gathering the necessary documents and joining calls to help the business owner understand and navigate requests.

Tax Implications: Advice on structuring the deal to optimize tax implications.

Why You Need One: They can provide clarity on the financial health of your business, ensuring you have a clear picture when negotiating a price and terms.

2. Wealth Advisor:

Role: This professional assists in managing the proceeds from the sale.

Investment Strategy: Help in deciding where and how to invest your money post-sale to ensure it grows and sustains.

Retirement Planning: Provide guidance on securing your future, especially if the sale is a segue into retirement.

Why You Need One: With the potentially significant proceeds from a sale, it’s essential to have a plan for your newfound wealth.

3. Attorney:

Role: An attorney, especially one specializing in mergers and acquisitions, is indispensable.

Legal Protections: Ensure all legal aspects of the sale are in order, protecting you from future liabilities.

Drafting & Reviewing Contracts: Draft or review purchase agreements, ensuring your interests are safeguarded.

Why You Need One: They can anticipate potential legal hurdles and ensure the sale process adheres to all regulations and best practices.

4. Certified Valuation Analyst:

Role: Certified Valuation Analysts specialize in determining the value of a business, a crucial aspect in the sale process.

Expert Valuation: They apply various methodologies to arrive at the most accurate and defendable valuation of your business. This includes reviewing financial statements, market conditions, and other qualitative and quantitative factors.

Objective Perspective: Unlike owners who may have an emotional attachment to their business, CVAs provide an unbiased valuation, which is critical during negotiations.

Why You Need One: Having a valuation is a good first step in determining seriousness in moving forward with the process. It also provides credibility with buyers and demonstrates that the asking price is grounded in a thorough, professional analysis.

5. Investment Banker:

Role: These professionals can be particularly useful if you own a larger business.

Finding Buyers: Leverage their networks to find potential qualified buyers.

Negotiation: Assist in negotiating the best price and terms.

Structuring the Deal: Provide insights into how the transaction should be structured for maximum benefit.

Why You Need One: They bring industry-specific knowledge and a broad network of potential buyers, which can expedite the sale process and possibly fetch a higher price.

6. Business Broker:

Role: For smaller businesses, a business broker might be more suitable than an investment banker.

Listing: Help in listing your business on various platforms.

Valuation Assistance: While not as in-depth as a CPA, they can offer general guidance on pricing.

Screening Buyers: Ensure only serious buyers approach you.

Why You Need One: They can streamline the selling process, making it less daunting for small to medium-sized business owners.

7. Industry Consultants:

Role: These are specialists within your specific industry.

Trends & Insights: Provide insights into current industry trends, which can be a selling point.

Potential Pitfalls: Alert you to any industry-specific issues you might encounter during the sale.

Why You Need One: Their deep industry knowledge can be invaluable in positioning your business favorably in the market.

Building a team of experienced advisors will not only ensure that the business sale goes smoothly but also that your financial and legal interests are protected at every turn. It’s an investment that pays off by providing peace of mind and potentially a better sale outcome.

If you need assistance assembling a team, Fates, Bodily & Parker can help. Contact us and let our experience help you navigate one of the most important decisions you will ever make.

You May Also Like…