If you’ve decided to sell your business, you have a few options available for doing so. Each one depends on several factors including how fast you want the sale to be completed. Regardless of how you sell the company, it must be done correctly so your rights and interests are protected.
Selling a business can take some time and it’s best done with the assistance of a New York business law attorney. Rosenbaum & Taylor is your trusted legal partner when you decide to sell a business in New York.how
How to Sell a Business
When transferring ownership of the business from yourself to someone else, the primary ways to do so are:
Gradual Sale
This means slowly turning over daily business operations to someone else. You will still receive income from the company over a certain period of time. But for owners not wanting to run the business anymore, it’s a great choice.
A gradual sale is also preferable if the buyer cannot afford an outright purchase all at once. Finally, this method is desirable if the new owner wants you to serve as a mentor before taking control of the business.
Lease Agreement
In this arrangement, the original owner continues to own the business but allows someone else to run it. Why choose this option? You, the owner, may not yet be sure about selling, but something is preventing you from running it. This option is also good if the new owner wants you to be a mentor. When the lease expires, the business will be returned to you.
Outright Sale
An outright sale is the fastest and easiest way to sell a business. Selling the business all at once allows the ownership to be transferred immediately. In return, the former owner gets paid and can walk away from any further responsibility. The outright sale is clean and is arguably the most common way to sell a company.
The Process of Selling a Business in New York
Whichever method you choose, you should retain the services of an experienced New York business lawyer to complete the sale. Your attorney will walk you through each step of selling your business, including:
Conducting a Valuation
Before you can get paid for your company, you need a business valuation to know what it’s worth. Determining the value often requires a multifaceted approach. You need to know, for instance, how much your physical assets are worth. This would include equipment, machines, furniture, etc. You can also assign a value to the company’s customer base and reputation, or good will.
Organizing Your Business
After setting the value, it’s time to get the business ready to sell. This may involve:
- Auditing the books to ensure taxes, creditors, and judgments are paid.
- Determining the physical condition of the business and making necessary repairs.
- Communicating with third parties, like the leaseholder of the building, to inform them of the sale.
- Wrapping up any contracts you have with third parties, which may require negotiation.
- Addressing any ongoing complaints, lawsuits, investigations, customer issues, etc.
Finding a Buyer
How you advertise the sale of the business will depend on various factors. Simple word of mouth may be enough to attract a buyer. The buyer will want to conduct due diligence to check the value of the business. Due diligence involves checking the company’s books and other internal records. Your New York business attorney can walk you through it.
Negotiating the sale, executing the purchase agreement, and closing. The potential buyer will likely try to negotiate a lower sales price. Once a purchase price is agreed to, a purchase agreement must be drawn up. Again, this is an area in which you need skilled New York business counsel. The deal will close, all final obligations by the respective parties will be met, and the sale will finalize.
Ready to Sell Your Business? Call Rosenbaum & Taylor
Our skilled New York business lawyers are here to help you sell your business. Let us counsel you on the right steps to take and handle all legal matters that arise. To begin your sale, call Rosenbaum & Taylor today.
