Selling a business can be a big and important step and may be something that a business owner has worked long and hard for. It is important to have proper knowledge of how to sell a business and proper guidance when approaching the sale of a business.
One of the most important aspects of selling a business is a sales agreement. The sales agreement outlines the sale of the business assets, stock and whatever is intended to be purchased as part of the business. In addition to assets, the purchase can include assets, customer lists, intellectual property and good will. It is important that the sale agreement details everything that will be included in the purchase. While it may seem like a laundry list of details, it is important that each detail is properly addressed and recorded.
The sales agreement should include the names of the seller and buyer of the business and the business name; any relevant background information; assets that are part of the sale; a list of inventory included in the sale; the purchase price; the terms of the agreement, including payment terms; a covenant not to compete; any warranties represented by the seller or buyer; access to business information; how the business will be run prior to the closing; any contingencies; fees; and the date of closing, among other details as the circumstances warrant.
In addition to the sales agreement, there will also likely be negotiations, due diligence that will be conducted, potential financing issues and other important considerations. Having an idea of how to approach both the big picture of selling a business, and how to handle the details, is important to the successful sale of any business.
Source: U.S. Small Business Administration, “Selling Your Business,” Accessed June 26, 2015