small business
Closing the deal
Eight essential steps for
selling your business
22 ;e Costco Connection AUGUST 2012
By Harvey Meyer
WHEN TOM SCHRAMSKI was selling his
small healthcare firm, he joshed that he
required “intensive psychotherapy” to cope
with the aftershocks. Such was the roller
coaster of emotions he confronted during and
after what is often a life-changing event.
“It can be very traumatic,” says the Costco
member, who now is a vice president for
American HealthCare Capital, a Marina del
Rey, California–based national mergers and
acquisitions firm.
It’s not unusual for small-business owners
to encounter emotional swings when putting
their “baby” up for sale. After all, many have
poured their heart, soul, sweat, tears and
identity into their enterprises.
Many small proprietors are skilled at
operating their companies, but they’re ill prepared for all that happens when it comes time
to sell. That includes the practical ins and
outs of peddling their firms, as well as the
emotional turmoil that often accompanies
selling, because they haven’t done it before.
With that in mind, here are eight essential
steps you might consider when selling your
own enterprise.
Know what you want
Think through your goals and objectives
well before selling and investigate your post-sale plans. If your buyer is predetermined—
say, an employee or friend—and price isn’t
paramount, then you may not be as concerned with following certain selling procedures. But it’s a different matter if you want to
obtain fair value or maximize your take.
In the latter case, perhaps talk to an experienced accountant or a certified business valuator to determine a proper price, advises Trevor
Hood, a Costco member and accountant
with SB Partners in Burlington, Ontario. Hood,
a member of the Canadian Institute of
Chartered Business Valuators, says a valuation performs a valuable service: It helps sellers
view their company from a buyer’s perspective.
“One of the biggest reasons sales aren’t
successful,” says Schramski, “is because sellers
have unrealistic expectations about the value
of their business.”
Prepare, prepare, prepare
Among the top reasons small-business
owners sell are health issues and burnout. But
unless you want or need to exit immediately,
you can enhance your firm’s appeal by prepping
for a sale at least one to two years in advance.
