Selling a business needs you to reveal vast amounts of information that may not be at your fingertips or even exist. Since the customer will inquire about them, you need to organize contracts, records, and insurance policies as you prepare to sell an organization and create them readily available . These documents will be required during the selling process, and having them ready for review will increase your credibility and authority as a competent manager running a valuable business.

Company Records

The company record book and annual reports, if you’re selling your entire business and not merely some assets, should conjointly be easily accessible. Your company record book contains your original incorporation papers, business name registration paperwork, bylaws, emblems, shareholder list, minutes of the directors conferences, and other documents. Small firms are typically lax here. If these don’t exist or sorely need updating, your company attorney will need to work with you to create them.

A limited liability company is not required to retain documentation as in depth as a corporation will. Nonetheless, you want to show the document that created your business and an operating agreement. Larger, multimember, restricted liability corporations often don’t document minutes of membership meetings or written consents of members for actions taken, however they should be on hand.

Processes and Methods

Documenting key processes and methodologies can assure that vital knowledge will not depart with anyone leaving your business, as well as you. Virtually every organization has important data that isn’t written down. It is imperative to capture as many as possible to demonstrate viability and worth to potential buyers and to assure a successful transition. This can be notably true for you along with for workers and management who may leave or are nearing retirement. Operations and procedures manuals will need to be up to date. Some of these documented processes belong in the contingency agreement discussed in a later article.

These are difficult efforts to estimate since they are relied upon the scale of your business, state of your current documentation, and additionally the complexity of your operations and methodologies. It can be helpful to bring in consultants with "new eyes" to work~to figure along with your organization to produce high-quality manuals and alternative documentation.   

Testimonials and Branding

To point out your business and its name, record and show customer testimonials and public relations activities that demonstrate your company’s standing and prominence. Sale and marketing literature will need to contain current documentation, reflect your company’s brand, and present it in a up to date and consistent manner. This might be a three-month project if you dedicate resources to it.

Brands do matter when it involves selling a business and a strong brand in the marketplace is added worth when it involves selling.  Improving branding and name recognition, however, can be more time-consuming. Having a solid brand can most likely pay off, however it will require a longer-term investment.

The Business Worth of Paperwork

It is very common for an abundance of the data required for an organization to work is in the heads of people who do it.  However, step into the shoes of the buyer  and understand what a risk that is.  Taking the time to try to do the documentation – as boring and time-consuming as we all know it is – will improve the value of the business.

I invite you to use these ideas as you start the journey to sell a business.

 

Marian Cook is a highly sought after business transition expert and speaker with over 25 years experience helping business owners design their best-life exit strategy, and improve their business performance and valuation.  She is the co-author of “Selling Your Business For More:  Maximizing Returns For You, Your Family and Your Business” (published by Macmillan).  If you are ready to sell a business and jump-start your business sale process, connect with Marian via her free tips, articles, checklists and blog at Business Transition Experts.