Selling a business is one of the most significant decisions any entrepreneur or business owner can make. Whether you’re planning an exit for retirement, seeking new opportunities, or exploring other ventures, a well-managed business disposal can lead to maximum value for your hard work. At Cogency CF, we specialise in guiding businesses through this process, ensuring that every step is covered with care and precision.
In this blog, we will take you through the various stages of a business disposal, from preparation to completion, so you can approach the process with confidence.
1. The Preparatory Stage
The first step in any business disposal is preparation. At Cogency CF, we believe that careful groundwork is essential for a successful sale. In this stage, we focus on:
- Reviewing and organising the business’s performance & financial records.
- Understanding the owner’s reasons for sale and personal aspirations (e.g., retirement, moving on to new projects)
- Deciding on the optimal timing for sale and any necessary pre-sale “grooming”
- Establishing valuation parameters
- Assessing tax positions
These initial steps ensure the business is ready for market, and that the owner’s expectations align with reality.
2. The Marketing Stage
Once the groundwork is done, it’s time to start marketing your business for sale. At Cogency CF, we assist in creating a detailed information memorandum that highlights the strengths of your business while managing potential weaknesses. We also:
- Prepare a list of potential buyers
- Use sophisticated databases to identify qualified acquirers
- Market the business to a select number of approved potential buyers
Confidentiality is key during this stage, so we ensure that appropriate non-disclosure agreements (NDAs) are in place before sharing any sensitive information.
3. Agreeing a Deal
The marketing stage should ideally lead to multiple offers. Selecting the right buyer is critical, and at Cogency CF, we help analyse these offers to ensure you get the best deal. Key considerations include:
- Price vs. terms: Offers may look similar on paper but could differ significantly in structure
- Financial stability: We assess the financial strength of the potential buyer
- Due diligence risk: We guide you in evaluating whether the buyer is serious and has the resources to close the deal
4. Due Diligence
After agreeing on an offer, the due diligence phase begins. This involves an in-depth investigation by the buyer to confirm that all information provided is accurate. At Cogency CF, we support our clients by:
- Helping prepare for due diligence
- Minimising the chance of price renegotiation
- Addressing issues promptly as they arise
5. Completion
With due diligence out of the way, we proceed to finalising the deal. Cogency CF takes charge of the entire process, coordinating with your legal and financial advisors to ensure a smooth transaction. Our role includes:
- Coordinating with other advisors
- Ensuring that all legal documents are in place including negotiating key elements.
- Overseeing the completion meeting and final paperwork
6. Exploring Alternatives
In some cases, business owners may consider alternatives to a full sale. These could include partial sales, management buyouts (MBOs), or even keeping the business in the family. At Cogency CF, we always consider these options in the preparatory phase, ensuring that the best decision is made for the business and its stakeholders. For more on alternatives to a business sale, check out this article on business exit strategies.
Conclusion
Selling your business is a significant decision that requires careful planning and expert guidance. With the support of Cogency CF, you can confidently navigate the complex process of business disposal, from initial preparation through to the final stages of completion. If you’re ready to explore the possibility of selling your business or would like expert advice on how to proceed, contact us today.