So you want to sell your business and are ready to take the first step.
For many owners, since this is not something they do on a regular basis, the first step is learning about all the steps, or the process they will be going through to sell their business.
Getting an overview and grabbing a picture of the road ahead makes total sense.
So below, in a simplified form, are the steps in the process. In later blogs we will examine the steps in more detail.
Steps to the process of selling your lawn & landscape business:
Getting ready to sell
- Preparing yourself and your business
- What got you to this point – age, health, burnout, etc.
- Understanding “retirement”
Selection of Your Team
- Retain expert M&A advisory team
- Client suitability
- Industry knowledge/experience
Evaluation of the Business
- Detailed report on company & its financials, etc.
- Create Seller’s Bible
- The result of the Evaluation
Go to market or enhance value decision
- Need an additional 3 years of positive trending?
Exit planning for Seller
- With either option above
Develop buyer profiles/prospects list
- Send teaser or profiles to prospects
Execute Confidentiality Agreements
- Both sides agree to keep the deal discussions and materials confidential
Distribute Offering Memorandum OM (once CA signed)
- Or Confidential Information Memorandum (CIM)
Buyer visits (can happen at other points in process)
- Management meetings
Receive offers based on CIM
- Buyer’s submit offers
- Terms such as price/terms
Letter of Intent (LOI)
- Non-binding offer to purchase
- Exclusivity in LOI
- Select one buyer
- Includes basic framework of deal/price/terms
- Confirm Seller’s claims
- “Kick the tires” period minimum 2 months
- Tighten-up the deal
Stock or Asset Purchase Agreement
- Negotiate & produce final agreement
- Create legal binding document
- 336H selection