Some tips on how to sell your small business? Nail down the details

By MATT KEMPNER
The Atlanta Journal-Constitution

This might seem like a bad time for the owner of a small or midsize business to try to get top dollar selling their company.

With the national economy faltering, plenty of potential buyers are uncertain of what's ahead, and that's likely to factor into their offering prices. Meanwhile, credit markets have tightened up over the last year, increasing the costs to finance a purchase.

But three local investment bankers — whose companies make money helping owners sell businesses — see reasons why deals still might go through. And they have advice for business owners thinking about how to do it.

MARK LOEFFLER / Managing director, VRA Partners, Atlanta

• If you want the business to attract private equity buyers, "make sure there are no holes in your management team." Private equity buyers often want managers to stay.

• Get shareholder agreements, customer contracts and other paperwork ready for close inspection.

• Have a trusts-and-estates lawyer advise you on wealth-transfer issues.

• "Be emotionally ready for and understand what bringing in a buyer means: You are going to give up control."

DOM MAZZONE / Managing director, Mazzone & Associates

• Don't miss sales projections while the months-long sale process is under way.

• Strategic acquirers — purchasers who already operate businesses in the same or similar industries — are the most likely buyers for some companies in the current market.

• While some companies may have trouble getting the high sales prices previously hoped for, there are risks of not selling and "assuming you can excel in this market."

MICHAEL SIEGEL / A local director, Houlihan Lokey Howard & Zukin

• Prepare your business well in advance. "If you are considering selling your business in 12 months, you're 24 months too late."

• Collect or write off overdue receivables, dump obsolete inventory, reduce the time it takes customers to pay.

• Look beyond national economic cycles. Considerations: advancing age, anticipating an increase in capital gains tax rates, being ready for a change. "Some people are just tired of running their business and may want to exit before ... a down cycle."