The 10 worst mistakes you can make when selling your privately owned small business - Page 3

5. Allowing the Buyer to Control the Process: If you allow interested buyers to dictate "what" and "when", you will find that you end up going through lots of processes (such as due diligence) numerous times rather than only once, which should be done solely with your prevailing buyer.

6. Not Having Multiple Buyers Involved in the Process: There is an old saying in the mergers and acquisitions industry: "one buyer is no buyer." This simply means that with three or four buyers competing for your business you are more likely to end up with the best possible transaction regarding price, tax structuring, getting cashed out, and having a low litigation risk profile.

7. Not Understanding Essential Tax Issues: After tax dollars in the sale of a corporation can vary between 45% and 85% of the sales price based solely upon tax structuring issues. This means that you need to understand the process before you start the process.

8. Neglecting Your Business While Trying to Sell the Business: Psychologically, once you decide to sell your business there is an inclination to slow down or spend time on the selling process to the detriment of the business. If you do this, earnings will suffer and it will lower your business's value, negatively influencing marketability.

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