Business Exit Planning
Selling a Metal Castings Business
Is the economy still a little shaky for a business sale? Sure it is. Yet metal castings businesses haven't heard the news and are reporting steady action on the business-for-sale market.
Business sellers are notorious for second-guessing themselves about the right time to put their companies up for sale.
If your exit strategy involves selling a metal castings business now, sellers need to make a strong case for buyers to purchase at or near the asking price.
Average Timeframes
Hoping for a quick metal castings business sale? You may be disappointed. The amount of time your business will be on the market depends on how aggressively it is priced and marketed. Before you can list your metal castings business, you'll need to invest as much as a year in preparing it for prospective buyers. Even though it's conceivable that an attractive opportunity could sell in weeks, an immediate flood of offers could indicate that the business is underpriced.
Turning the Tables: Buyer Concessions
Sellers aren't the only ones who can make concessions in a business sale. In many instances, sellers can request buyer concessions. For example, if the buyer needs seller financing, you can leverage a five-year loan to push for a higher sales price. Although you won't see all of the proceeds upfront, you'll earn interest on the balance and realize a higher price than you would in an all cash deal. Asset exclusions, retained ownership shares and long-term contracts with another of the seller's companies can also be leveraged to extract concessions from buyers.
Working with Appraisers
An experienced appraiser is part and parcel of a successful metal castings business sale. Armed with a professional appraisal, both you and your broker can enter the negotiation stage with confidence. Even though you may disagree with the appraiser's value estimates, it's important to give your appraiser the information and independence he needs to present an objective opinion. To ensure accuracy, ask your broker to provide references for appraisers with industry experience.
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