You need to clearly identify your objectives to achieve your desired sales outcomes. Consider the following:

• Will you remain part of the operations?
• When would you like to sell?
• What are your financial expectations?

Who is your preferred buyer?

You will need to connect with your stakeholders—family and owners—to align on the process and principles of a business exit. It’s important to have conversations with family members on how to cope with the change in life and sudden liquidity. If you have multiple owners, it’s important to align owners on the desired outcome.

Figuring out how much your business is worth can seem overwhelming and complex, but understanding the value is essential. There are several factors that will impact your company’s value including industry, current economic conditions, and competitive landscape. It is important to obtain a formal valuation to thrive in today’s shifting market.

Once you know what your company is worth, there may be opportunities to enhance its value to reach your sales objectives. With the help of our Value Creation team, we can provide tactics and strategies that will enhance your performance, position the business to make it attractive to buyers, and get you exit ready.

Presenting clear, well organized financials to buyers makes a good impression of your business. You should be able to present an accurate P&L and balance sheet for each accounting period looking back from three to five years. With an Accounting Advisory professional, you should also assess the most appropriate accounting basis: Accounting Standards for Private Enterprises (ASPE) and International Financial Reporting Standards (IFRS).

Buyers are interested in businesses with IT systems that can integrate into their own and that do not require major upgrades or a complete overhaul. Technology platforms can either increase or decrease your value.

The BDO ExitRight team will facilitate strategic planning meetings with your management team to maximize value drivers and salability factors as well as develop a SWOT analysis, define critical success factors, goals, strategies, and develop an action plan. Lastly, a forecasting model will be developed to monitor progress against targets and final valuation.

To ensure a smooth and seamless transition, conversations and a thorough plan needs to be developed to outline the new management structure, define roles and reporting lines, and develop a plan to de-emphasize the owner. Another important area is identifying HR related selling risks such as termination obligations, employment standards, and health & safety.

There are two primary methods to sell an incorporated business in Canada. It can happen through the sale of shares or the sale of assets, and the way in which a business is sold has several short- and long-term tax implications. Early, proper planning is required to minimize tax and ensure the company qualifies for the capital gains exemption. Ensure you speak with a tax professional to plan for a potential sale.  

You’ve spent your entire career building your business, now it’s time to start thinking about your lifestyle goals post-sale. With the sale proceeds of your business you will need to consider estate planning, gifting, trusts, and asset protection. You will also need to determine whether you want to fully retire, start a new venture, or reach other life goals. You will need to have a plan in place.

An M&A advisor will work closely with you to market the business based on your sales objectives, find a buyer, and negotiate the terms of the transaction through continuous communication at every stage of the process. Running a competitive process is key to maximizing the selling price.