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How to find a buyer for your business

Steve Sink is the founder and managing partner of Phoenix Affiliates Ltd.

Disposing of your business is not as simple as planting a 'for sale' sign outside and waiting for potential buyers to line up. Just as with selling a house or any other major asset, a lot of work has to go into finding suitable buyers, and persuading them that your company is worth their time and attention.

Before you start to look for a buyer, you need to lay the groundwork for a possible sale. This means putting your financial and administrative records in order, ensuring that your cash-flow is healthy, and perhaps even spending a little money in order to improve your asset base and impress potential new owners.

If you don't spend the time to do this at the beginning of the sale process, you will undoubtedly waste a lot of energy trying to do it whilst buyers enquire, and may even lose a sale because you cannot answer basic questions. Don't short-change yourself in this foundational phase, because it will make <a href="http://us.businessesforsale.com/">finding a buyer</a> much easier.

Once your business is in good shape for a purchase, you will need to decide whether to use a broker in order to sell it. The advantages to a broker are obvious, in that they take on most of the time-consuming search for a buyer themselves, and have existing networks to do so.

 They are also able to act much more confidentially than an individual owner working on their own. After all, it might not be good for the short-term health of your business to broadcast the fact that you want to sell. If you are comfortable with being open about your decision to sell, however, acting on your own might make more sense. It will certainly save you money.

Whether you are searching for a buyer yourself, or using a broker, the obvious place to start is by considering your existing competitors. If you are a successful part of the marketplace, similar companies will always consider a takeover.

After all, not only will they gain another outlet for their product or service, but they will also remove a competitor and increase their market share. Of course, you should only put out feelers to your competition when you are absolutely sure that you want to sell, and should only approach those companies whose management style and overall strategy would fit well with the existing culture of your business.

If you are not comfortable with the idea of selling to an existing competitor, you will need to search out new entrants to the market. This is best done by using your existing contacts, particularly by asking regular suppliers and trusted customers to put out the word in their own networks.

If you are happy to sift through a number of purely speculative offers, you can also put out a traditional advertisement in the trade press for your particular sector. If you prepare a succinct and well presented information pack to send out to any serious enquirer, you are likely soon to find a number of potential buyers getting in touch.

Just make sure that you perform your own due diligence on them, and check out the state of their finances. Don't waste your time on a buyer who cannot afford to pay!

 This article was contributed by BusinessesForSale.com, the market-leading directory of business opportunities and Steve Sink, Business Intermediary with Phoenix Affiliates.  ss@phxaffiliates.com


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