Considerations When Selling a Business
“Considerations When Selling a Business”
- Is it the whole or part of the business?
- What Business Names, patents and trademarks, registered designs or logos, are included in the sale?.
- Make sure financial records are up to date and include values of equipment?
- Ensure all leases for premises, equipment and motor vehicles are up to date?
- Are there any hire purchase agreements?
- With bank loans and overdrafts, are any of these secured over the business?
- Are client records up to date and ready for inspection?.
- Is there a detailed inventory of equipment and if owned by the business or other persons or organisations?
- Are details of staff and employment contracts available?
- Make sure all other Agreements associated with the business, such as client agreements, distributor agreements and franchise agreements are up to date and available?
- Is there council approval for use of the premises of the business?
- Are all Telephone Number(s), Domain names, Websites and Email addresses included in the sale?
- Are details of forward Advertising arrangements prepared for the buyer?.
- Have you asked your accountant regarding values of various components of the business, and taxation implications in valuing various components of the business and GST considerations? (Generally, a sale of a “going concern” attracts no GST, but a non operating business does).
- Have you obtained a valuation of the business to assist in determining a sale price?
- Do you wish to be restrained from opening a similar type of business?
- Is there evidence of Compliance with required laws eg. Workcover etc,?
- What are special waste arrangements, if any?
- Is the company name transferred with the sale?
- Is stock included in the price or in addition to the price and what is the value?
Upon you agreeing with your prospective buyer or buyers on selling price and terms & conditions;
To avoid any problems arising in the future, it is important that you obtain legal advice prior to entering into a formal Sale Contract so that you clearly understand your sale obligations and your solicitor can make sure all legal requirements are met.