Transworld Blog

From business brokerage to mergers and acquisitions; we are the business sale specialists.

All Posts

Tips for the Transition Period When a Business Sells

The way a business transitions from one owner to the next can have significant repercussions for its future success. Could you imagine what might happen if, upon completion of the sales transaction, the seller handed the keys to the buyer and, with a “good luck”, simply walked away? So much knowledge, insight, and history would also be going right out that door.

For that reason, negotiating and carefully planning how the transition will take place is of primary importance.

The Seller's Role During the Transition Period When a Business Sells

The way in which the seller is involved after the sale will vary from one deal to another, however, make sure you make the most of their availability during the transition.Tips for the Transition Period When a Business Sells

Consider phasing the previous owner out gradually during the transition period when a business sells. During the initial phase, the seller might continue working on a full-time basis without any change in roles or responsibilities, giving the buyer a chance to observe and learn how the business operates.

In the second phase, the seller remains working at the business, but the new owner is now in charge of making critical decisions. After a while, the seller can go down to working on a part-time basis until, eventually, it is not necessary for him or her to show up for work anymore but remains available for phone calls or consultations.

Business Planning

The buyer may be coming in with lots of great ideas and plans for the future for the business. The transition period when a business sells can be an excellent time to work on those plans. While it’s not a good idea to implement sweeping changes immediately, being able to tap into the previous owner’s experience and perspective can help you avoid costly mistakes and setbacks.

Communication

Part of the objective of your transition strategy should be to make it as seamless and worry-free for your customers as possible. To do this, start with your employees. If they are worried or concerned about the future, the quality and service they provide to customers may be compromised. Meet with your employees to explain what they can expect from you. Be aware of the mood and morale of employees and, without being dishonest, do what you can to reassure them of their job security and to boost their morale.

You'll also want to communicate with your vendors and suppliers to keep them informed of the change. For key vendors with whom the company enjoys a special relationship, you may want to consider scheduling a personal meeting that includes the seller.

Don’t overlook communicating with your customers. You'll want to reassure them that, under your management, they can expect similar or superior levels of customer service. It's also an opportunity to solicit their input and perspective on what your company does and how it could be improved in the future.

Of course, if the seller was in charge of managing critical relationships, you’ll want to involve him or her in that transition by meeting jointly with those clients to detail how the seller will be easing out of that role and handing it over to the buyer or someone else within the company.

When you're buying a business, you're buying its assets, its operation, and its ability to generate revenue. But under ideal conditions, you're also buying its history and accumulated knowledge. It's only by carefully planning the transition period that you can ensure the transfer as much of that history and knowledge as possible.

You can browse through the many outstanding businesses for sale in Minnesota by visiting our business listings page.

Related Posts

PPP Loan Hurting Your Business Sale?

I Want To Sell But Have A PPP Loan  If your business has a PPP loan and you are selling all or part of the business, you may need approval from the SBA or the bank that handled your loan. You may also need to put the amount of any unforgiven portion into escrow at close. 

Is Buying A Business A Good Idea?

Yes!  Buying a business is a good idea.  Why?

Ten Steps To Selling Your Business

Our Sellers except us to achieve the highest and best offer for their business while taking the least amount of their time away from it as possible. That is because the absolute best use of their time is to continue to run and grow the company.  If revenue or profits begin to decline, buyers will walk away or decrease their offer. Transworld's philosophy can be summed up in a ten step, how-to strategy that culminates with the sale of a company. This proven method has been used to sell hundreds of businesses.  Here are the steps. Step1 Comprehensive Business Analysis and Feedback As your business broker, the first thing in our how-to strategy is to analyze your operation, finances, market potential and industry trends. We take that information and advise you on steps to prepare your business for sale, and  generate a business profile that represents your company in the most attractive way possible. Step2 Sale Structure We identify the best possible price range to sell your company. This is based on solid facts, the condition of the market, projected growth, sales potential and the sale of similar businesses within your industry. Transworld’s experts apply sophisticated, time-proven valuation techniques to ensure that your price is appropriate for the current market condition. The price must not be too high or too low. Yet, it must represent an attractive investment potential for the buyer. Step3 Confidentially Network The Business For Sale During the selling process, we utilize the latest technology to present your company to other business brokers and strategic buyers all over the world. This greatly multiplies the effort in your favor. With Transworld Business Advisors, you have literally thousands of industry professionals confidentially representing your company to buyers.   Step4 Confidentially Advertise To Buyers Our aggressive marketing program ensures your confidentiality and provides maximum exposure for your company. Your listing is placed in various industry databases, Internet sites, and publications which are constantly updated. We spend more money in advertising and marketing for buyers than anyone else in our industry. Step5 Control The Information Flow We organize all necessary documentation and release information only as needed. We use limited information when advertising to maintain confidentiality. Buyers are pre-qualified and required to execute a confidentiality agreement before receiving any sensitive business information. Step6 Create Competition For Your Company We attract thousands of buyers, creating competition for your business. Buyers are qualified for financial ability to meet the offer, and we engage you with only the most qualified buyers. Once you meet the best of the buyers, we urge them to prepare and present all offers. We can continue to engage potential buyers on your behalf as negotiation on an offer is in process and have another interested party ready to go should a buyer change their mind. Step7 We Negotiate For You To Achieve The Best Price Appropriate negotiation is crucial to achieving your best price and terms. We have the expertise to establish sound and resourceful negotiating techniques on your behalf. Transworld has trained all of its agents in the art of negotiating through curriculum that we have created specifically for our industry. Never negotiate without planning, expertise, or from a position of weakness. Step8 We Provide Exceptional Support To You Through The Due Diligence Process We take pride in our exceptional service. Only half of the job is finding the right buyer who will pay your price and meet your terms. The other half is getting that buyer to the closing table. We quarterback the deal, work with the accountants, lawyers, banks, landlords, and other third parties that could jeopardize the success of the transaction. We realize that you depend on us to guide you through the sale of your business. We make the transition simple and easy for you. We know when an opportunity for you may arise and are always there to take advantage of it. We also know when someone is trying to kill your deal or is being unreasonable and how to handle those situations. Step9 We Are There From Beginning To The Closing We help manage all administrative procedures, licenses, inventory counts and lease assignments that may be required. Transworld works closely with your advisors to ensure a smooth transition. Using the latest technology, we strive to be ready to work on your behalf to get the deal done! Step10 We Are There For The Transitional Phase And Beyond! Because we are in the business community, you may want to consult us from time to time after the sale. We will provide you with the assistance after closing. Transworld will always remain in your corner! Schedule Consultation Now

Your Goals Are Just the Beginning

Talk to one of our Advisors today about next steps.

Free Consultation

E-mail address

minnesota@tworld.com

Contact us

+(888) 290-5232

Confidential Consultation

Talk to an Advisor