To view this article on Today’s Medical Developments Magazine website, click here.

Selling your business is a significant decision. As a business owner, chances are this question is often on your mind simply because of the number of phone calls you receive on a regular basis from would-be buyers.

How do you respond to these calls? Are they serious? Is it the right thing to do? If you say yes, I’ll listen and they make you an offer, the next question is what should I do? Should you do it alone?

Before embarking on a journey here are a few thoughts to consider:

1. Is this potential the only buyer out there? Unless the offer comes from a niche player and you’re in a niche market, there’s usually more than one potential buyer for your business. Do you know who they are; should you be reaching out? The issue when doing so yourself is it will immediately be visible you’re for sale. That might impact your customers, suppliers, employees, and your value or simple ability to complete the sale.

2. Could I get a better offer? If you get an offer, how do you know it’s the right one? Does that number make you happy? If so, great. While going through due diligence, be careful not to let the original figure be brought down. Also watch out for earnouts. Have enough cash upfront to make you happy and only accept earnouts where you have control over the goals set. This is all part of negotiations. You’ll go through a lot of those before you sell your business, these are just a few. Doing it alone doesn’t shorten the process.

What if you question if there are other companies who would offer more? This is a key question. You have worked hard to build your business. Don’t leave money on the table. The average amount of additional value an advisor will help you gain is 25% above what owners get for their business without an advisor/broker by their side.

3. What will it take for me to go through the process? Selling your company’s a complicated process. Anyone who tells you otherwise would be ill advised. You as the seller will have to gather historical information on everything about your business. Three to five years of data is what you’ll have to provide on financial and taxes. Be prepared to answer questions about your customer base, distributors, sales force, employees, manufacturing, and a lot more.

Is everything at easy reach? If not, we would advise to start gathering before entering the process. It can become overwhelming very quickly.

4. Do I know what to do? As mentioned above, a lot goes into selling your business even if you had a fast track ticket to getting an offer. Do you know what to expect and what will be required of you? It’s not unusual to have a seller standing alone facing a group of people on the other side and feeling overwhelmed by the process. From signing your letter of intent (LOI) through the transaction, the buyer will be following a strict process. Make sure to understand their process and ask questions before getting started. It’ll minimize the risk of surprises.

5. Do I have the bandwidth to go through this process and run the business as well? Take a look at your daily schedule. Can you fit selling your business into your already full schedule? Selling your company is a full time job. If you decide to do it by yourself, make sure your business continues to grow while you do so. Any negative change, such as sales decline, will impact the value of your company or possibly cancel the deal.

6. How much money will I save by doing it alone? As mentioned above, in the United States the average added value brought to a deal by an advisor is 25% above what a seller would get from selling alone. Yes you do have to pay your advisors, however if your advisor helps you get a higher value for your business it is a win-win situation.

Our advice? Talk to an advisor and ask all your questions. A knowledgeable advisor should have a good track record, knowledge of the market, contact with buyers, experience in your field, and a strong process in place to help you get across the finish line.

Whatever road you decide to take, cheers to your success!

About the authors: CEO Florence Joffroy-Black is a long-time medtech M&A and marketing expert. She can be reached at florencejblack@medworldadvisors.com. Managing Director Dave Sheppard is a former medical OEM Fortune 500 executive and an experienced medtech M&A professional. He can be reached at davesheppard@medworldadvisors.com. Value = Strategic Fit + Timing® is a registered trademark of MedWorld Advisors.

To view this article on Today’s Medical Developments Magazine website, click here.