Three Common Pitfalls to Avoid When Selling Your Business

In a recent special edition of THE EXIT Podcast, host Brett Dearing delved into the common mistakes business owners make when preparing to sell their businesses. From financial preparedness to post-transaction planning, Brett shared invaluable insights for navigating the sale process successfully. Let's explore key takeaways from the episode and delve into strategies to maximize the sale of your business.

1. Lack of Financial Preparedness
One of the recurring themes highlighted by Brett is the lack of financial preparedness among business owners. Without organized and updated financials, preparing a company for sale becomes a daunting task. Potential buyers rely heavily on financial data to assess the value of a business. Therefore, ensuring your financial records are accurate, audited, and in order is crucial for a smooth sales process.

2. Developing a Transition Plan
Another critical aspect that business owners often overlook...

[Link to podcast episode below]

Business valuation is not just a number-crunching exercise; it's a strategic tool that is central to a business owner's exit planning strategy. Valuing a business can be compared to a captain of a ship knowing the vessel's exact position before setting course for the next destination. For business owners, understanding the worth of their business is essential for making informed decisions about their future and the legacy they wish to leave behind.

The 'why' of business valuation often relates to the appropriate timing of an exit. Business owners typically toil for years, even decades, to build their business. However, it is a common pitfall to neglect valuation until a sale is imminent. This oversight can result in leaving significant money on the table during negotiations. As discussed by the host, Brett Dearing CEPA, CMAA in THE EXIT Podcast, many business owners leave 15% to 25% of their business value behind, a costly mistake that...

As a business owner, one of the most significant milestones you will encounter is the transition of your business, better known as 'The Exit.' This whitepaper will explore the importance of exit planning as outlined in THE EXIT Podcast, particularly in the episode featuring Brett Dearing. We will delve into the essential aspects of preparing for a successful business sale, the role of qualified advisors, and the impact of these preparations on the transaction value.

The Stakes of Negotiation

Brett Dearing emphasizes that business owners, despite their subject expertise, often leave significant value on the table when exiting their business. It is estimated that between 15% to 25% of business value can be lost due to poor negotiation strategies. The whitepaper will discuss strategic planning tools like the Certified Exit Planning Advisor (CEPA) program and why assembling a team comprising accountants, trust and estate attorneys, M&A attorneys, and investment bankers is crucial...