Working Capital is a Business Asset
Negotiations around working capital are one of the more misunderstood and often contentious parts of a business transaction.
Mind Your Balance Sheet
Most business owners have a good sense of their profit and loss statement and want to make it a focal point of conversation. However, they don’t seem to grasp the importance of the company’s balance sheet. The lack of understanding or poor quality of information on the balance sheet can dramatically impact a transaction.
Know Your Business
The financials of a business usually tell a story. Does your discussion of the business history, trends and reason you are selling align with the story the financials are telling? Knowing the key metrics and variables that are impacting your business will not only help in a sale, but in your day to day decision making.
Getting Your Financial House in Order
Even though business is humming and you’re ready to move on, the business may not be ready to be shown in the best light. Just as you would stage a house for sale, certain aspects of the business should be staged in order to reduce the apparent risk and show the best true profitability of the operation.