Preparing For Due Diligence When Exiting Your Business
If you’re planning to sell your business, it’s crucial to prepare for the due diligence process well in advance in order to maximise its value.
Here are some key steps to take:
> Organise Your Financials — To avoid scrambling to respond to due diligence requests, take the time to organise your financial records in advance. Make sure that you have all the necessary details and formats included, beyond just the standard management accounts.
> Legal Evaluation — Ensure that all your contracts, licenses, permits, and intellectual property are up-to-date and accessible. You should be able to demonstrate compliance with all relevant regulations.
> Be Prepared — Due diligence involves answering a lot of questions about a wide range of topics, so make sure that you’re ready. Don’t be caught fumbling for answers or taking too long to respond to specific queries.
> Understand the Valuation Process — Focus on the factors that really impact your business’s value. Many business owners fall short here, so take the time to understand the valuation process.
> Seek Expert Support — Due diligence can be a complex and time-consuming process. Consider seeking outside expertise to help accelerate the process and ensure that you’re not leaving money on the table.
Remember, it’s never too early to start preparing for due diligence. Don’t wait until the last minute to get started. If you’re ready to discuss the process further, let’s connect and start a conversation.
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