BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - 15

FEATURE

|

BY SMALL BUSINESS BC

TOP MISTAKES TO
AVOID WHEN SELLING
YOUR BUSINESS
This article is reprinted from SmallBusinessBC.ca with permission.

Exiting your business can be a
tricky endeavour, especially if you're
looking to get the best price within a
reasonable time frame. Above all else,
information will be your ally during
the process. Many of the frustrations
and challenges sellers face in today's
market can be summarized by a lack
of quality information about potential
pitfalls and how to overcome them.
There are also several common
mistakes entrepreneurs face during
the selling process. To help you avoid
these banana peels, here are the top
mistakes to avoid when selling your
business:

Lean on professional help
While you may be an expert
in every aspect of running your
business, you're not an expert in how
to sell it. Enlist lawyers, brokers and
accountants during the process to
ensure you've covered all the bases.
Take the broker, for example. Sure,
they'll cost money up front but they're
usually capable of adding 10-20% to
the sale price. A lawyer can help you
navigate the legalities of the sale,
including several you likely haven't
even accounted for. An accountant
will help you get your books in order
before selling - one of the first things
www.bsiabc.ca

a potential buyer will ask for during
their due diligence.

Pre-qualify potential buyers
Buyers naturally want to perform due
diligence on your business. This process
isn't a one-way street. You should
perform your own pre-qualification
checks on potential buyers to ensure
they're both a good fit and financially
capable of buying the business.
Request pre-qualification documents
such as financial records and
confidentiality agreements before you
release any critical information about
your operation. This will prevent wasted
time on both sides and ensure potential
buyers are adequately vetted.

Avoid misrepresenting
your business
There's nothing wrong with wanting
to present a glowing picture of your
business during the selling process.
However, it's important not to
misrepresent any facts to potential
buyers. Avoid the temptation to
fudge numbers, be overconfident in
projections or tell any lies relating
to your operations. While some
sellers have undoubtedly got away
with it over the years, due diligence
will uncover some lies. Any that slip
through the net could become basis
for legal action after the sale.

Don't breach confidentiality
Be extremely careful with
publicizing your business is for sale.

During this period, it needs to be
business as usual for your operation.
Confidentiality during the process
is key. A business broker will be
skilled in marketing your business to
potential buyers while also ensuring
the transaction is appraised quietly.
If customers and staff know your
business is in on the market it can
adversely affect sales and morale at
a pivotal time.

Ensure a transition
plan is in place
Many businesses are left
floored when an important staff
member departs. Far too much
organizational knowledge can
be held within the brains of key
staff, and nowhere is this more
apparent than the business owner.
One of your first moves when
you decide to sell is to ensure all
processes are noted down and
explained so that anyone can pick
up the threads and ensure smooth
operational consistency.

Find out more
Small Business BC offers
one-on-one consultations with
business brokers, lawyers and
accountants as part of its Talk
to an Expert series. Discuss the
issues surrounding the sale of
your business with an expert and
ensure you receive the best possible
return on your investment. Visit
www.smallbusinessbc.ca. 
FALL 2019 | BSIA NEWS | NEWS MAGAZINE

©ISTOCK.COM/SARINYAPINNGAM

T

hinking of selling your
business? This article
focuses on some easy
mistakes to avoid when selling
your business.

15


http://www.SmallBusinessBC.ca http://www.ISTOCK.COM/SARINYAPINNGAM http://www.smallbusinessbc.ca http://www.bsiabc.ca

BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019

Table of Contents for the Digital Edition of BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019

Chair’s Message
Board of Directors
BSIA News and Events
Building Supply Warehouse and Distribution Program Graduation
Orion Award Winners
The Five Step Approach to Boosting Business Growth
Top Mistakes to Avoid When Selling Your Business
Finance Corner: How Proactive Are You Around Employee Benefits?
President’s Message: Last Word
Index to Advertisers
BSIA Affinity Partner Program
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - Intro
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - bellyband1
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - bellyband2
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - cover1
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - cover2
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - 3
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - Chair’s Message
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - Board of Directors
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - BSIA News and Events
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - 7
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - 8
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - Building Supply Warehouse and Distribution Program Graduation
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - Orion Award Winners
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - 11
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - 12
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - The Five Step Approach to Boosting Business Growth
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - 14
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - Top Mistakes to Avoid When Selling Your Business
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - Finance Corner: How Proactive Are You Around Employee Benefits?
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - Index to Advertisers
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - BSIA Affinity Partner Program
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - cover3
BUILDING SUPPLY INDUSTRY ASSOCIATION - Fall 2019 - cover4
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