As part of the process to being ‘sale agreed’, we will verify the financial position of the potential purchaser whether this be proof of their cash funds or an indication of a finance offer, should they be relying on borrowing money to buy the business.
Once we are happy with this we will issue ‘Heads of Terms’. This document goes out to all parties involved in the deal, particularly the solicitors so that they know the outline of what has been agreed in terms of the price and any special conditions agree as part of that transaction. These conditions could relate to a timescale, a deposit, a lease assignment, a transfer of shares, stock etc, etc.
At this stage you will generally be in the hands of your solicitor and working to their processes and procedures and timescales. It is important to be organised and prepared with your paperwork as you will need to provide all documentation as part of the sales process. If you haven’t got some paperwork, chase up the supplier of that paperwork at an early stage so that the deal is not held up. Selling a business is rarely a quick process. Due diligence is required by the buyer and solicitors will also be managing their different clients and timescales of each deal.
It is important to stay in regular contact with your solicitor and us as the agent to keep us posted on any progress or challenges that arise. Where possible we can help by putting you in touch with people that can help remove any issues you are facing. A buyer may wish to undertake a survey of the property and this will always highlight issues that may not have been covered previously.
If you are buying or selling a leasehold pub you will need to deal with the brewery or pub company and work through their processes and timescales. If the business is being sold as a going concern there can be issues around VAT, transfer of staff, shares in the company which owns the business or property, transfer of names on licenses, planning permissions, supplier contracts etc.
The property you operate the business from will generally need to have an EPC (Energy Performance Certificate) & an Asbestos survey. These can all take time and add cost to selling your business.
As part of the deal, you as the buyer may be required to pay a deposit (particularly if it is a leasehold business) to take it off the market. This is different from a residential sale where generally you only pay a deposit on exchange of contracts. The terms of the deposit need to be agreed and who holds the money as well.
As your agent we are happy to hold your hand as much or as little as needed. If you have never bought or sold a business before it can be a different process from what you may think and it will inevitably lead to questions. We are here to help make the process as smooth as possible.
When all the paperwork is completed and contracts issued by the seller’s solicitor then each party should be ready to exchange contracts. It is possible to exchange and complete on the same day as this will simplify the process in terms of who runs the business in the meantime. If stock is being included as part of the deal then a stock taker may be required to go in and to verify the value of the stock that is being transferred and paid for on the day. Buyer and seller will usually meet on the day to handover the keys and explain any operational points to running the business. There will often be a handover period agreed between buyer and seller and this is usually in the last few weeks before completion of the deal so that when the new owners take over they do not go into it completely blind to the reality of the day to day operations of the business.
Once the deal is completed, all parties can move on to the next stages in the lives. For the buyers, they can begin to put their own stamp on the business and for the sellers it may well take them into their hard earned retirement or to move on to a new challenge or project.
Buying & selling a business in Essex is not always a straight forward process and requires an expert or dedicated agent to work through the process with you. We hope to get the opportunity to help you to sell your business in Essex. Please feel free to contact us now.