Are you considering selling your Florida-based business? Whether you’ve already compiled the paperwork or you’re only considering the option, there are a few key details to keep in mind when selling a business in Florida.
There are approximately 2.5 million small businesses in Florida, making up 99.8% of all businesses in the state. These businesses change hands over time as business owners decide to buy and sell.
After investing long hours into building a business, it’s essential that you make the most out of the sale. Before you sign on the dotted line, it’s important to consult with a business attorney who understands the intricacies of state law and best practices.
Let’s explore five fundamental questions to consider before selling a business in Florida.
1. Is It the Right Time to Sell?
The business landscape is constantly shifting, and you need to consider whether you will get the true value out of selling your business. Market conditions will play a big role in consumer interests, the price of your business, and how your business is valued. Depending on the urgency, you may want to hold onto your empire a little bit longer.
In addition to general market conditions, there are a few personal reasons to consider, such as the following;
- The business has outgrown you
- You have outgrown your business
- The industry is getting smaller and it’s time to pivot
- Opportunities for a partnership
- Your heart is no longer invested in the business success
- You want to buy another business and need the capital
2. Does the Buyer Persona Matter?
There’s a lot of blood, sweat, and tears that go into making a business a success. Handing the responsibility over to someone else demands a lot of thought – or maybe not!
What Is the Legacy of The Business?
If you are experienced at building businesses with the sole intention of selling them, then you may not be too concerned about the person that takes it over. However, if you’ve forged your personal identity with the brand then you may be more selective about who continues the legacy. Take the time to consider your buyer’s persona and the criteria for making the sale.Once you’ve decided on your ideal buyer, you can determine whether or not the interested parties are, in fact, right for the business. For example, consider whether their beliefs align with the business.
3. Do You Have an Exit Strategy?
Have you considered a plan for leaving the company and how the transition will take place? There are various options available and it’s important to carve out the time to develop an exit strategy. Determine whether you want an overlapping transition period, whether you will sign a non-compete after the sale, and what your income plan is for after the sale.
4. Is the Business Value Realistic?
A thorough evaluation should offer guidance on the appropriate selling price for your business. There are different methods of evaluation and experts to help navigate the task, but as the business owner, you play an equally valuable role in setting the price.
Assess the Strengths and Weaknesses
One of the first steps to evaluating your business includes assessing the strengths and weaknesses of your company. Consider aspects such as your existing customer base, the intellectual property that belongs to the company, and profit margins.
When it comes to selling a business, it’s easy to be guided by emotion rather than logic. However, it’s important to remain objective when evaluating your company’s worth. A professional business appraiser can be invaluable in this instance. A good, experienced business broker may be useful to you in this regard.
5. Do You Understand the Sales Process?
There are several moving parts involved in selling a business. If you want to make the transaction with confidence, then it’s important to familiarize yourself with the process of selling a business.
Familiarize Yourself with The Process
There are several steps included in selling a business in Florida, including filling out essential documentation. For example, the engagement letter from your investment banker, a non-disclosure agreement (NDA), a letter of intent (LOI), and the purchase agreement.
You’ll need to find a broker, appraise your business, and negotiate all of the details needed to seal the deal.
Strike A Balance Between Transparency and Confidentiality
It may be tempting to reveal everything about your business to all potential buyers, but it’s important to establish clear confidentiality rules that will protect the business until the final deal is signed.
Hire an Expert in Florida Business Law
There are many benefits of hiring a Florida-based business attorney when selling a business.
Consider the following as a starting point:
- Expert knowledge of Florida’s legal requirements
- Ensure all documents are completed as needed
- Protection against potential risks and liabilities
- A speedy and efficient sales process
Find A Local Business Attorney in Coral Springs
With more than 50 years of experience in legal services, the Law Offices of Gary I. Handin, P.A., offers expert insight on all you need to know when selling a business in Florida. Contact us at 954-796-9600 to find out more or book a legal consultation.