For many business owners, selling their business is an emotional time. After years of building your business, you now wish to sell and move on to the next phase of your life. Most business owners don’t have previous experience selling a business and are unaware of how to begin. We have created six basic tips to start you down the correct path.

1-Make sure the business is in “top” condition. Any cosmetic fixes that need to be made should be completed before hand. Painting, wallpapering, repairs, etc. should all be performed prior to market exposure. Our suggestion is not to perform costly, major changes as the new owner may wish to make major changes to suit their own preferences.

2-What is my business worth? The next step in selling a business is determining what it's actually worth. There are numerous formulas for valuing a business. Buyers may base a purchase price at least in part on the value of the assets in your business, the cash flow, gross revenues, annual growth and other factors. The bottom line price usually depends on the profitability of the business. A factor of your net profit plus owner salaries is a good multiple to business value. Consulting a tax expert would be our advice.

3-Create an adjusted profit & Loss Sheet. Many small businesses do whatever they can to show as little profit as possible. Good for tax purposes, but when it comes time to determine the value of your business this needs an adjustment. Your business should be presented in the best possible, fair manner. An adjusted profit & loss sheet adds back the items deemed either more personal or not necessary to operated the business. The business owner or tax expert can create the necessary financials.

4-Be prepared to carry some financing.  In some cases you can find a cash buyer but you should prepare for the fact that you may have to carry part of the sale price back for them. A short payoff period of 4 to 5 years is common and it does earn you interest income during the payout. Make sure you check on the buyer's financials, background and their business history and experience.

5-Confidentiality. Keeping the sale of your business Confidential is of up most importance! You don’t want to disturb your customers, employees, suppliers or regular business routine. Letting others know that your business is for sale can be a big mistake. If employees or suppliers start abandoning ship this could prevent a sale or adversely affect your selling price, quite possibly proving very costly.

6-Use Marketing experts. A good company in the field of marketing and exposing businesses for sale can locate and qualify buyers for you. A company working on your behalf can market and advertise your business in a professional, confidential manner.