Planning on selling your business is not the same as selling a property or any other valuable assist.

We have compiled a guideline to assist you to get started with the process.

1. Determine what your business is worth.
2. Prepare your financials with your accountant.
3. Find a broker.
4. Develop the executive summary of your business.
5. Put your business on the market.
6. Field offers from potential buyers.
7. Let the buyer perform due diligence.
8. Closing the deal

There are several ways to determine the market value of your business

• The most common and effective valuation principle used in today’s economy is the Price Earnings (P/E) Ratio method. General rule of thumb is Net Profit for the last financial year multiplied by 3. Eg: Net profit as at Y/E 28.02.2020 R 500,000 then Value of business is R 1.5 million. This is the base value of a business, although there are other mitigating factors which are also taken into consideration, i.e. economy at present, years of establishment, licenses etc.
• Tally the value of assets – Add up the value of everything the business owns, including all equipment and inventory. The value of these must be added at replacement value. Subtract any debts or liabilities. The value of the business’s balance sheet is at least a starting point for determining the business’s worth. But the business is probably worth a lot more than its net assets. How much revenue and earnings can you expect?
• Base it on revenue – How much does the business generate in annual sales? Calculate that and determine, through a stockbroker or a business broker, how much a typical business in your industry might be worth for a certain level of sales. For example, it might typically be about two times sales.

Prepare your financials

The financials will be required for a potential buyer to determine the value of the purchase. 

Compile the following documents in preparation for your business sale:

• Profit & loss statements for the current and past 2-3 years.
• Management Accounts
• Current balance sheet.
• Cash flow statement.
• Business tax returns
• Copy of the current lease.
• Insurance policies.

Find a Broker

Graphite Business Brokers is a Company that has several years’ experience in assisting with compiling of sales packs using our unique presentation and presenting a business in its entirety, we link buyer and seller. We sell businesses. Our tasks include helping companies to determine a favorable price, analysis of business, presenting and Marketing to a target Investor audience and through social media.

Benefits of Using Graphite Business Brokers

1. Confidentiality: Selling a business is not like selling a house where you want everyone to know about it. Instead, in most cases, it demands discretion so that the confidence of both the employees and the customers is not endangered, keeping the business operating as normal.
2. Marketing: Graphite Business Brokers have an experienced team that know how to market your business to buyers that are in the target market segment can readily appreciate its key values, rather than becoming caught up in non-essential details.
3. Objectivity: Buying and/or selling a business can become a very emotional transaction to both parties. Often, a simple miscommunication between a buyer and seller can result in a lost deal. Graphite Business Brokers brings objectivity into the process, negotiating the sale in a cool and calm manner on your behalf.
4. Closing the deal: Graphite Business Brokers is highly experienced at closing the deal and uses all our expertise to ensure that the deal is sealed to the benefit of both parties.
5. Paperwork: Buying and selling a business involves a lot of paperwork, all of which must be completed and submitted appropriately. A reputable Business Broker like Graphite Business Brokers can help you through this process, leaving you to enjoy the results of the sale and reflect on your future.

How much does it cost to sell a business?

• The upfront fees required to value, market, and sell the business range from R2,000 – R25,000. 
• Our professional commission fee can range from 5% to 15% of the total sale price.

Develop the Executive Summary

This information is a crucial part of the sale of the business, it tells us, Graphite Business Brokers, all about you, your company and why it is a great opportunity to buy.

Put your business on the market

After Graphite Business Brokers have received the mandate and the retainer fee, we start the marketing process.  Our marketing strategy is simple but effective. Each mandate of ours receives a custom design marketing plan.

Our marketing plan consist of the following steps:

1. We start by drafting an in-depth sales proposal
2. We contact our database and present the business for sale
3. We list your company for sale on numerous platforms designed for businesses for sale, including our website and social media pages
4. We market it on various social media platforms
5. We advertise on different digital media platforms (WhatsApp, telegram etc.)
6. Just Listed bulk email to millions of subscribers

We have a database of qualified buyers, who are actively looking at buying businesses and it is compiled of over 300 individuals and 200 Companies and growing daily.

Field offers from potential buyers

Once an interested buyer has returned our non-disclosure, we open communications with them, and we start verifying if they indeed can afford to buy the business. If we are confident that the potential buyer is indeed qualified in all aspects, we then start arranging meetings and scheduling Q&A’s.

Should this lead to us receiving a verbal offer, we arrange for the written offer to purchase to be signed by all parties and a deposit to be paid to a trust account.

Due Diligence

Due diligence helps investors and companies understand the nature of a deal, the risks involved, and whether the deal fits with their portfolio. Essentially, undergoing due diligence is like doing “homework” on a potential deal and is essential to informed investment decisions.

Some guidelines but not limited to on preforming a due diligence:

• Understanding why the owners of the company are selling the business
• Examining historical financial statements and related financial metrics, with future projections
• The quality of the company’s technology and intellectual property
• The company’s target consumer base and the sales pipeline
• The company’s management, employee base, and corporate structure
• Closing the deal

When all the conditions had been fulfilled and both parties are in agreement, the deal will commence by the signing of the sales agreement drawn up by the seller’s attorney and verified by the buyer’s attorney, money gets transferred to the same Trust account as Deposit was paid, Once all parties are in agreement Graphite Business Brokers pays the Seller their sale price less commission as agreed on the Mandate.