At Viking Mergers & Acquisitions, we take great pride in our ability to keep all information confidential. At no time will the name of the company or owner be revealed. We require any serious buyer to sign a Non Disclosure Agreement to protect the seller’s interests, and then we present them to you for approval before they see the name or any other confidential information about your business.
For more information, see our article about Why Confidentiality Counts When Selling Your Business.
You don’t pay anything if your business doesn’t sell. Our fee is a percentage of the sale and is only paid once your business is sold. Thus, our interests are aligned with yours, meaning we do not get paid until you get paid. It’s also in our interest to sell your business for the highest price possible. We do not ask for any retainer fee. We are performance based! Contact us to learn more.
There are many elements that dictate the worth of a business – such as cash flow, equipment values, historic financial performance, lease terms, location, recurring revenue/repeat customers, competitors and the economy. Potential “strategic fit” and efficiencies of scale or eliminating redundancies also will come into play for strategic buyers. A Viking intermediary is capable of analyzing your business and comparing it with your competitors and recent transitions (“comps”) to reach the best price for your business. The documented evidence that we use to determine the value of your business will also assist in securing qualified buyers who are willing to pay the maximum price.
The market has strengthened since the economic downturn of 2008/2009 and we have seen a steady increase in the speed in which businesses are selling. We are having our best year, which means it is a great time to sell. The time to sell can vary based on a number of factors, but we’ve had several businesses get offers within the first 30 days, and close within 3 months! On average over our 20 years, the average is 6 to 8 months from start to closing.
It’s also important to realize the different elements in selling a business. Once the business is officially listed, the marketing, on a very confidential basis, begins and we will review your business with qualified prospective buyers (with your approval). When a buyer wants to buy your business, they will typically submit an “offer letter” with the price they are willing to pay and outlining the applicable terms. At that point, you have a tentative deal, pending “due diligence”. Due diligence is a period where the buyer will check facts, review financials, and make sure that the information they had based their offer on is indeed accurate and representative. This period can vary in length but we generally want to limit it to 14-21 days as we do not want the business off the market for a prolonged period of time. With financing and legal documents to prepare and finalize, the entire process from offer to closing/funding typically takes 60 days.
We hear this from many of our clients who are too young to retire, and our answer is: anything you want! Once you have secured your investment in selling your business, you have many options as an entrepreneur. Most sellers in this position take time off to recharge their batteries and start or buy a new business in a different industry. We have found that a successful entrepreneur can apply his or her success in one business to just about any other type of business. The choice is yours!
For more information, consider our article about How to Avoid Sellers Remorse.
The purchase price of your business and the allocation of that price towards FFE vs. goodwill dictate how much you will pay in taxes and affect the buyer’s taxes as well. Most business owners are able to treat the sale of their business as capital gains, and thus typically pay a lower percentage on that income than they would if it were “normal” income from the operations of their business. This said, we must encourage you to contact a CPA before and after the sale of your business for details, exceptions, and expert advice specific to your situation.
For more information, see our article on The 4 Most Important Tax Issues to Consider When Selling a Business.
We have an established network of qualified buyers throughout the Southeast that are interested in buying businesses with us, as well as buyers we locate through our listing-specific advertising programs. We mainly work with four types of buyers: individual owner-operator buyers, financial buyers, strategic buyers, and private equity buyers. After selling more than 800 businesses, we are skilled at identifying good matches between buyers and sellers, ensuring we find a buyer that can successfully run your business.
The best time to sell your business is when it is doing well. You want to sell your business when the profits are rising to ensure you get the best price for your business. The fact that your business is doing well will also assist in securing a buyer sooner rather than later while setting the buyer up for success.
That said, even if your business is not performing at its peak, we encourage you to contact us. We can discuss actions you can take now to best position your business for a sale in the future – whether that is six months out or five years out.
Selling a business, especially for the first time, can be stressful and difficult to navigate. Viking advisors have tremendous experience, and our team takes care of all aspects of closing a deal; confidentially marketing, financial preparation, buyer screening, negotiating, due diligence, and post closing activities. By using an advisor to sell your business, you also give yourself leverage; your advisor works with a pool of buyers versus you working with one at a time to try and make ends meet.
Another benefit to using a brokerage firm like Viking is that we have an existing pool of thousands of qualified buyers actively looking to buy businesses in various industries. For this reason, it is not uncommon for us to receive significant interest – and in some cases offers – within a few weeks of listing a business.
Remember: you hire a CPA to do your tax return, and you hire an attorney to help you with legal issues. Likewise, you need to hire a professional when it comes to selling one of your largest assets – your business. Selling your business is one of the top 5 events you will experience in your lifetime!
For more information, see our article on Selling Your Own Business vs. Hiring a Pro.
In most cases, sellers cash out at the closing of the sale and receive a lump sum. Occasionally, the bank may require sellers to carry up to 10% on a “Sellers Note,” but even when that is the case, the seller still receives at least 90% at closing. Some sellers may offer “seller financing” which means they are open to receiving payments in multiple installments over a longer period of time. Offering seller financing is completely optional and up to the seller. In our experience, most sellers prefer to receive all or most of the purchase price in a lump sum at closing.