Business for sale in UK
CURRENT INSIGHTS: 3 important steps you should consider if you decide to put your business up for sale in the UK
There are many important factors to consider if you decide to put your business up for sale in the UK such as:
How does your business fair in comparison to current UK market conditions? Inflation pressures are putting huge pressures on costs which in turn can put pressure on profits. Labour markets are also very buoyant now which is leading to staff shortages and high demand for certain worker segments.
What values are you looking for in a prospective buyer? Strong markets are attracting large volumes of private equity players from national and international companies. This can drive the sale price of a business up considerably.
All of these market factors can strongly influence the price you can achieve from selling your business. If you do decide to sell your business, you have two main options; you can sell directly to a buyer and not pay any business sale broker fees or go through a business sale broker and pay a fee. Whilst going direct seems attractive because it’s fee-free, selling a business is about creating value, and value inevitably drives the price you can achieve from selling your business.
If you do decide to use a business sale broker, they will consult and work with you to devise the best exit strategy for your business sale, based on your required goals. This consultation could include an analysis and evaluation of your business compared with specific benchmarks, industry norms and UK current market conditions. Business size, deal expectations and opportunities within the UK market all need to be considered when deciding how best to launch the sale of your business. For a business up for sale in the UK Kings business sale brokers have broken down 3 important considerations:
A BUSINESS SALE BROKER WILL HELP YOU KNOW YOUR BUYERS
Even if you are selling a highly sought-after business it’s important to identify the relevant buyer pool and to bring the sale of the business to the attention of every appropriate potential buyer. You need to do your homework and cover the whole UK market. If you have tunnel vision, you may end up in a one-horse race with a single potential buyer and miss out on other buyers who are ready, willing, and able to make you a better offer.
When you have identified your pool of ready and capable buyers’ the art of negotiation must come into play to achieve the best overall deal in terms of price. The best negotiators get to know their bidders inside and out. Understanding their motivations and drivers behind the value of the acquisition from a buyer’s specific perspective helps to deliver value with impact.
It’s imperative to understand each buyers’ characteristics and processes. Are there any foreseeable bottlenecks such as complex and time-consuming due diligence requirements? Are their turnaround times lengthy and likely to cause delays? Is the buyer showing signs of behaviour such as ‘chipping’? This is a term coined within the industry when someone reduces their offer price last minute.
Business sale brokers know the markets they operate within and should have knowledge about the most suitable buyers under the current UK market conditions. They also know the process of selling a business inside and out. They’ve gone through this process many times before and can therefore foresee potential holdups and problems with completing a deal. Getting the deal through as quickly, diligently and efficiently as possible will not only provide value and reduce stress, but it will also provide the best chance for deal completion. Deals can involve extensive paperwork and part of the business sale brokers remit should be to ease the administrative burden of this process for you. There could be many regulatory, tax and legal requirements to satisfy. Ensuring all parties involved keep to their committed timescales should all be part of a business sale broker’s remit.
A BUSINESS SALE BROKER WILL COORDINATE MULTIPLE STAKEHOLDERS SO THAT THE BUSINESS SALE IS SUCCESSFUL
Managing multiple interested parties and their individual requirements is imperative, but it is time consuming and stressful. A business sale broker should have developed strong coordination and organisational skills, it’s part of their remit to keep the deal hot and ensure it doesn’t run cold because a perspective buyer couldn’t access the information they needed. They know a prospective buyer will be looking at other potential purchases, and so know to get all the important information about your business to them first.
Once an offer is accepted it’s important to understand the due diligence requirements of a buyer. A business sale broker will be able to work with you to smooth out various due diligence stumbling blocks and to facilitate as smooth a transaction as possible.
DEAL CONFIDENTIALITY
Ensuring that the sales process is and remains confidential is critical for all parties involved. Leakage of information can cause damage to the continuity of customers and staff, especially if the information is disclosed in a deal that doesn’t come to fruition. Retention of staff is critical in a deal process and in a sector where staff recruitment is challenging. Within the deal process, it’s imperative that a business sustains its momentum, continuing with its projected financials as any dips or drops can negatively affect the realisable value. A business sale broker should ensure confidentiality is maintained through the safeguards they have in place. This includes ensuring all interested parties sign a non-disclosure agreement (NDA). They need to always ensure any potential buyer signs a binding NDA that legally prohibits the leak of any information that could be damaging to the sale of the business.
HOW WE CAN HELP
At Kings, we seek to create a competitive scenario where multiple vetted parties are bidding for your business as this essentially drives the price up. We call this the ‘Kings bids invited’ process. Our day in day out interaction with buyers and our Kings Buyer Intelligence Hub keeps our fingers on the pulse. We work for our clients to maximise both their transaction value and their exit deal structure.
Our key focus is to endeavour to create a competitive bidding process to maximise the sale of your business with a view to obtaining the maximum deal value. Throughout your client onboarding process, the Kings Team will collaborate with you to develop every component of your business’s sales campaign. From the wording of your adverts through to the digital imagery used – every detail is essential to the success of the campaign. Our routes to market have been tailored to achieve the optimum results for our clients and encompass a full selection of the marketing avenues available.
Are you thinking of selling your UK business?
If you are considering selling your business and have any questions about what you may need to consider, then one of our experienced sales negotiators are always here to chat through any important points you may want to discuss.
Are you looking to buy a UK a business?
If you are looking to buy a UK business, then the Kings sales team are here to work with you. Perhaps you are considering entering a new market or expanding your presence within an existing one? Whatever stage you’re at Kings Business has a wealth of opportunities that may be of interest to you.
