Frequently asked questions about selling a business
Click on the questions below to get answers to the most frequent questions we get asked.
If you have a specific question, not answered here, then please contact us using the contact page here.
- Is my business saleable?
- How much is my business worth?
- When is the best time to sell a business?
- Why use a business broker?
- How do I choose a business broker to sell a business?
- How long does it take to sell a business?
- What are the tax implications of selling a business?
- What information will I have to provide?
- Should my accountant sell the business for me?
- What kind of businesses do you sell?
- What size companies do you sell?
- What geographical area do you cover?
- Do you offer advice to buyers?
- Why should I use Lucas & Weston?
- How do you keep the sale of my business confidential?
- How will I know what is going on?
- How do you find me a buyer?
- How are meetings held and managed?
- Who will handle the sale for me?
- What are your fees?
- I've tried to sell before but nothing happened. Can you help?
- I have been approached about selling. What should I do?
- What are the main reasons businesses don't sell?
- How much time will I have to put into the process?
- What about solicitors?
- How do I get started?
In our experience, nearly all businesses are saleable if they are priced correctly and are presented to enough people in the right sectors. Even if the business makes a loss.
It is highly recommended that you have a thorough market appraisal and valuation prior to attempting to put a business on the market. It can help highlight areas which, if left unchecked, could cost you thousands of pounds, cause unnecessary delays or even stall a sale.
For further information visit our sister website www.businessvaluationreport.co.uk
A well known rule of thumb is 'as much as a willing buyer is prepared to pay for, and a willing seller is prepared to sell for'. In reality, it is worth what anyone will pay following a sustained and inclusive marketing campaign having created a competitive selling environment. That said, many factors can determined business value. These include cash flow, sustainable profit, asset value, financial history, location, competition, customer base, industry standards, ongoing management and the economy.
What you think your business is worth makes little difference, and potential buyers will place little credibility in a value arrived at by your accountant or bank manager. Only the marketplace can decide its true value. Incorrect value and unrealistic vendor expectations are the principal reasons many business sales fail. A buyer will dismiss your business if it is not priced reasonably.
Please see our valuation page for more information.
Usually, when it is doing well, and you don't have to. Obvious as it is, the decision to sell your business is not one which should be taken lightly. Plan and prepare your business well in advance. Haphazardly going to market can seriously undermine your chances of success. It is possible to sell most businesses if prepared, structured and priced correctly.
A good broker should be able to find buyers beyond the obvious - buyers you couldn't find on your own. The more choice of buyers you have, the better negotiating position you can command, enabling the best possible deal.
Experienced of running a competitive sales process will ensure the sales proceeds, far outweighing any fees involved.
A buyer will automatically assume a position of advantage if they see you have chosen not to take professional help, especially if they arm themselves with experts - beware.
Selling a business can be a complex and time consuming process, and it is very easy to underestimate. Using a broker means that you will benefit from an experienced professional who understands what it takes to make a deal happen – controlling the process from start to completion - ensuring no loose ends.
One of the best reasons to use a broker is to act as a buffer between you and the purchaser. There will certainly be times when you'll want to adopt a tough negotiating position. A broker makes this possible without antagonising the buyer. You might have to work with a new owner during a post sale handover.
Follow this link to find further information on how to choose a business broker
Alternatively click here to find out why you should use Lucas & Weston
It depends on the market conditions and what is for sale. Our average business sale takes between five to eight months from start to finish. You should allow a full year. In most cases, we are talking to the eventual purchaser within the first eight weeks.
It will depend on your personal circumstances. Some form of tax is inevitable, and it is vital you get advice on the tax regime applicable to you.
Currently, within the UK, the tax on limited company sales is still favourable to the seller – with capital gains tax from as low as 10%.
Further information can be found at: HM Revenue & Customs - Capital Gains Tax Page
Initially, we would ask for your latest set of accounts and/or management accounts together with any business plan or company literature. We would then contact you, in confidence, to discuss your business's saleability and answer any questions you might have.
Any enquiry will be confidential and without obligation.
The first steps of a business sale are neither legal nor accountancy based. A principle reason many sales never get off the ground. Selling a business is first and foremost a SALES and MARKETING exercise.
A business broker who excels at sales and marketing knows the marketplace and has experience of completing a wide range of transactions should be the first person you contact. A good broker can make a dramatic difference in not only how your business is sold but also how much you get.
WHO you sell with can SERIOUSLY DAMAGE YOUR WEALTH!
We sell sole traders, partnerships, limited companies and public limited companies (PLCs) in most industrial, manufacturing, leisure and service sectors. However, we only seek instructions from profitable going concerns with a minimum adjusted net profit of £100,000 or more. We don't get involved in turnarounds or liquidations.
We are selective and cautious about the engagements we undertake. Our preference is to handle a smaller number of high-quality transactions.
Businesses worth between £300,000 to £10million. Typically with a turnover from £500,000 to £10million.
We represent clients all over the UK. From Aberdeen in Scotland to London, the South East and West and all that is in between. We have successfully represented a business from Australia too. In today's modern world geography is no longer a barrier. We are more interested in your business and its operating sector than its geographic location.
As an independent company acting on behalf of our clients, we offer limited advice to purchasers. However, we are happy to point them in the right direction to banks and lawyers who might be able to assist them.
Click here for advice for buyers
Click here to find out why you should use Lucas & Weston?
We go to great lengths to safeguard the confidentiality of our clients. We have a tried-and-tested process of maintaining confidentiality. We vet and pre-qualify all our purchasers making them sign confidentiality undertakings / non-disclosure agreements. No sensitive details of any business are ever given to potential purchasers without a client's consent.
Regularly updates keep you informed at every stage of the process. No details about your business are ever given out without your express permission. You control who we talk to and what we tell them. We are accountable to you at every step of the way.
With every new instruction, we do extensive and diligent background research to find who has the financial capability, appetite, and interest to acquire your business. Most of our clients are positively surprised with the levels of serious purchaser enquiry our sales process generates.
We have developed market leading, cutting-edge marketing initiatives which deliver results.
There is no other broker operating in the UK, who consistently delivers as comprehensive and inclusive marketing package as we do.
We organise viewing meetings, which are initially held off site, or in a neutral location. Our job is to look after your best interests, guiding you through every step of the sales process and making sure you get best value for your business.
All our engagements are director led, which insures that you have an experienced professional assisting you at every step of the process. They are in control and fully accountable for every aspect of your sale.
Our success fee is contingent. This means we have the incentive to get you the best possible price. Unlike many brokers, we don't make money on excessive up-front fees. We don't have sneaky or hidden extras, and our fee structure is transparent and fully inclusive.
This is a very common problem. The chances are there is a very good reason your business hasn't sold. Once we have identified and rectified this, we can help sell the business for you.
The first thing you should do is verify and vet the purchaser to see how serious the offer is. If it is serious, you're going to need some help. In the absence of a competitive bidding scenario, it is highly unlikely you would receive the best value.
You need to establish if the offer is acceptable or if the market place could deliver a better opportunity. We have an excellent track record of negotiating and benchmarking offers that makes deals happen. Give us a call, in total confidence, we'd be delighted to help.
Have a look at our negotiation only page as it might be suitable for you.
The two principal reasons that businesses don't sell are: the wrong price and not identifying and talking to enough serious buyers. It is possible to sell most businesses if these two issues are properly addressed.
An article of interest we wrote for the business pages of the BBC News website.
You will have to prepare some paperwork. If you are well organised, this shouldn't be a problem. We handle virtually all of the time-consuming or potentially intrusive elements of the selling process on your behalf. Client owners can continue to run the company without disruption or distraction. Our pre-qualification purchaser-screening process avoids tyre kickers, nosey competitors and time wasters. Once a deal is agreed you will have to spend some time working alongside your solicitor. Again the more organised you are in advance, the easier it is.
Once a deal is agreed, a solicitor's job is to draw up the definitive sale and purchase contract. It is vital that you work with a solicitor whose main field of expertise is corporate law - principally the buying and selling of businesses. Choosing the wrong solicitor can cost you time, and a lot of money and untold amounts of stress and can even put your deal in jeopardy.
Have your questions answered, or start the process NOW. Call us on 0845 644 0266 from the UK (local rate charged). Callers from outside the UK please dial +44 (1225) 460 777.