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Frequently Asked Questions About Selling a Business

Why should I use a Business Broker to sell my business?
The most common mistake potential Sellers make is comparing the selling of their business to selling a house. Business Owners who have sold a business in the past will likely tell you it is a long, stressful process. Selling your own business can actually hurt the value of your business as it takes your focus away from day to day operations at a critical time when you should be increasing or at least maintaining your business, as well as preparing the business for sale. Business Brokers will help properly value your business, reach out to buyers they already have, reach a larger number of new buyers, allow you to continue running your business, maintain confidentiality and, most importantly, assist with the closing your transaction. 

Why choose First Choice Business Brokers?
With unsurpassed experience since 1994, offices across the U.S. and some of the most highly trained Business Brokers in the industry, First Choice is the "Clear Choice" when it comes to choosing a Business Brokerage to represent you. Our Business Brokers are experts in the field of business evaluation, business sales, business marketing and buy/sell negotiations to satisfy both buyers and sellers alike. Our contracts have been time tested over thousands of transactions and designed to protect all parties involved. We'll also help you assemble the team needed to close the transaction and we'll help manage potentially rough waters during due diligence to ensure contingencies are released and there is a smooth transition of ownership.

What is the significance of confidentiality and how is the sale of my business kept confidential?
Unlike the sale of a home or even commercial building, businesses do not have a "for sale" sign. Business Sales must be kept confidential to maintain the continuity of the business. Most Buyers are not interested in buying businesses where employees, contractors, suppliers and customers are distracted by the sale. Potential Buyers are briefed on the importance of confidentiality and are required to sign an NDA (Non-Disclosure Agreement) prior to accessing detailed information about your business. Your First Choice Business Brokers filters inquires (often tire kickers), helps determine which Buyers might be ready to move to the next level, and employs a strict process for releasing certain information at critical milestones.

When should I notify my employees that I am selling the business?
While you may have a close relationship with your employees, it has been proven time and time again that the best time to tell your employees is when you introduce them to the new owners. This may be difficult for you emotionally, however experience dictates that silence is the best practice. The exception to this rule would be if a "key" employee is part of the negotiation for the Buyer to keep them on after the sale is complete. In this case there may be some advance notice required to this person and this person alone. Your First Choice Business Broker will guide you through the timing of this important part of the business sale- timing is everything!

How will my business be advertised?
With First Choice Business Brokers, your business will be on the highest rated websites for your industry and area as well as national and international sites. In addition, we'll match your business to target Buyers in our database and call them discretely. The content strategy is designed to maximize inquiries without revealing the identity of the business.

How do I know how much my business is worth?
First Choice Business Brokers proven methods of valuation are incorporated into a proprietary Market Price Analysis (MPA) model to put your business in the best possible position to sell. A price range will be presented along with a recommended market-based price based on deal structure and other factors important to the Seller. First Choice Business Sales Professionals are some of the most highly trained professionals in the industry.

How long will it take to sell my business?
Properly priced businesses in familiar and sought after industries can sell in approximately 90 day. However this time frame can vary greatly based on the income of your business (and how easy it is to prove), type of business, the terms offered, the area in which your business is located, economic trends and local factors. Your local First Choice Business Broker will provide you with more information on local markets in Michigan.

Will Buyers be visiting my business?
After a Buyer has signed an NDA, reviewed initial information and expressed a further interest in your business, your First Choice Business Broker will arrange a phone or in-person meeting between you and the Buyer either at your location after hours or another location. This starts the Seller-Buyer relationship which is a significant element of the sale, unlike most real estate sales.

How do Buyers write offers to buy my business?
Most Buyers looking at your business will be represented by a professional Business Broker who will assist them in writing an offer that expresses their price, terms, contingencies,and request for further documentation. Your Business Broker will present the offer for your review and approval along with guidance on any questions or alternative strategies in working with this and other Buyers. In business brokerage, it is not uncommon for one business broker to represent both Seller and Buyer.

Will I need to finance part of the purchase price of the business?
While there is no requirement that you provide seller financing, it is very common that Buyers will request it. In reality, this opens your business to a larger pool of Buyers and may provide you with tax benefits (consult your CPA). Your First Choice Business Broker can guide you on terms and implementation.

Will my First Choice Business Broker verify the Buyer's credit, finances and capabilities?
First Choice does not check the Buyer's credit. However, we can show you how you may request that the Buyer provide you with a copy of their credit report through the offer and acceptance process. Your First Choice Business Broker will get background information on Buyer's capabilities and request proof of funds.

Who will handle the negotiations on the sale of my business?
Your First Choice Business Business Broker is trained to deal with negotiations, help you stay in control and provide relevant available options.

How long will I have to train the person who buys my business?
This is a negotiable item, but we have found that most Buyers will ask for 30 days. Some types of businesses only require a week or two of training while complicated businesses may require a longer transition and training period. If an extended period is required, your First Choice Business Broker may be able to negotiate a consulting fee for the Seller. 

After I sell my business, can I open another one at some point in the future?
All Buyers will ask that you sign a covenant not to compete within a certain area for a certain time.