Get your lease in order
You may have a great relationship with your landlord and have let your lease operate on a month to month basis. This is a big issue when selling your business as any purchaser will want certainty as to the security of their investment and would also need to show a bank lending them funds that the lease is long enough to justify a loan. You should either speak to your landlord and extend your lease before putting your business on the market or be prepared to make any contract of sale conditional upon extending your lease.Make sure your business is compliant with laws and regulations
Business settlements can be tripped up by an unexpected compliance issue. Examples of this could include illegal building works, non-compliance with food hygiene regulations or planning issues. It is important that you review your business before putting it on the market to bring any issues into line to increase the likelihood of a smooth sale. You should make sure (if relevant) your liquor licence and food premises registration are up to date.Get your books in order
Purchasers want to see an organised business that makes a profit. When selling a business for up to $450,000.00 it is generally a requirement that the vendor provides a summary of the financial performance of the business in a prescribed form. A purchaser will use this to assess the business performance and what price they may be willing to pay. A purchaser will always be more impressed by a business that clearly demonstrates its financial performance so that they can make a decision to purchase.Make a detailed inventory of your equipment
We often find that vendors have not prepared a sufficiently detailed inventory of their equipment for inclusion in the contract of sale. It is important that an equipment list names each item of equipment with sufficient detail for it to be identified. You should also prepare a list of equipment that is not sold with the business so as to avoid dispute at settlement as to what is being sold noting if any assets are indebted by a finance company.Register your business name
It is compulsory to register a business name in Australia if you operate a business under a name other than your own. Therefore, you should have already done this. If not you should register your business straight away. Your business name is an important part of your intellectual property and something that a purchaser generally purchases. If you are thinking about selling your business please contact our business acquisition and sale specialist Will Elder.Will has developed a broad commercial practice in which he advises clients on business acquisition and sale, commercial agreements, commercial and retail leasing, and commercial litigation. Learn more about Will's legal experience.
