Preparing for the sale of your business.

If you are thinking about selling your business, it would be greatly beneficial to catalog all of your assets in order to help facilitate a successful sales transaction. One of the first lists an owner should make is his FF&E List (Furniture, Fixtures & Equipment). A business value is calculated in part by its list of assets. The more you can substantiate your asset value, the more it can increase the overall business value. Selling a business differs greatly from selling real estate. Part of the value is intangible and requires a trained expert to realize and quantify it.

Some of the assets that a seller needs to address include:

Equipment: Is the equipment old or new? What condition is it? What’s the replacement value?

Trade name, Trademarks, & Patents: Does your name and product represent value to your customers?

Inventory: How much inventory do your have? What condition is it in? What’s the value?

Customer & Database Contacts: How many contacts do you have? How many are repeat customers?

Key Employees: Will a Key Employee stay on with a new owner? Will any customers be lost by replacing a Key Employee?

The Lease: What are the terms & conditions of the Lease?

Business Records: You might not think of your financials as a hard asset but if you have excellent books & records, you will more likely stay close and validate your asking price. Positive Cash flow is the most common measure of the Good Will component of a Business’s Valuation.

In order to calculate and understand the overall value of a business, you need to look at many different aspects of the business. As a Certified Business Broker, I look at the many variables, including assets, both tangible and intangible, in order to properly value a company.

If you have any questions about selling your business, please contact Certified Business Broker Robert Dean, CBB at Banner Business Sales, Inc. Phone: 310-793-6757. Email: