When opportunity knocks: selling your business.

• Author: Bissonette, Laurie
• Position: BUSINESS SENSE

If you are a private company owner contemplating retirement, receiving an unsolicited offer to sell your business might seem like winning the lottery. As with most things, fortune tends to favour the prepared, so being prepared for what is surely one of the most important decisions of your life makes real business sense. And it's important to get it right the first time as opportunity seldom knocks twice.

First thing, don't be surprised. Companies are always on the lookout for acquisition opportunities that are a strategic fit for their own business needs. However, some owners can be rushed into selling before they are fully prepared. An unsolicited offer is like a bolt from the blue that can strike without warning, including when you have an illness or have suffered a financial setback. Instead of taking the necessary time to properly review a proposal, you are simply reacting to whatever offer is placed in front you.

The due diligence process that accompanies most acquisition discussions can prove daunting. Ideally, you should be prepared to provide a positive snapshot of your business on short notice. Unfortunately, many business owners are not fully equipped to do that. Usually the buyer is looking for specific information from the seller to determine whether or not the business is the right fit. Your challenge is in determining what information to provide to the buyer. Having the relevant facts and figures readily available is one of the best ways to create confidence in the company's management team and strengthen your hand during any negotiations. Without this, the buyer may discount the value of your business and offer a lower price. Worse, they may decide to simply walk away based on that first look--this happens all too often.

You don't want to shortchange yourself in the process. Your expertise and detailed knowledge of the day-to-day running of your company can weigh heavily in a buyer's decision to proceed to closing. As a business owner, you should have a capable management...