THE SELLING PROCESS


What We Need in Order to Successfully Sell your Business

Following the initial interest to sell your business, a Broker/M&A Advisor will meet with you in person or if not possible, by phone, to discuss our services, processes, and answer any questions you may have.  After such meeting, assuming that there is adequate trust and understanding between us, and you would like to move forward with our successful process in pursuit of the sale of your business, the following will outline in summary, the stages of our methodical and confidential five stage selling process.

Valuation

Stage One: Assessment of the Most Probable Selling Price (Market Interpretation)

Valuation Fee

At this initial yet critical stage of the process, we seek to interpret the “Real Value” of the business as determined by the current open market. This is done by performing and providing a detailed, yet understandable valuation report that considers multiple methods under the three main approaches to business values. This report will articulate what we call the Most Probable Selling Price (MPSP) and forms the base of the first stage of our process. This is an essential step to the process and we charge a cost recovery fee for all valuations. The valuation fee is independent from the “Success Fee” paid for the successful sale of your business and will vary based on required work, business size, and other factors. Please discuss the fee with one of our professional Brokers/M&A Advisors to determine your applicable fee.

Most Probable Selling Price (MPSP Report)

In performing the interpretation of the MPSP, we work with you to confidentially complete any normalization of the historical financial information, understand the business and market space, determine realistic growth potential and projections, understand current market conditions, determine value drivers, and more. This enables us to provide a reasonable and critical assessment of the MPSP that will provide you with a realistic interpretation of the actual market value, size, and other critical information that will help you make key decisions and answer such questions as: “Is this the right time to go to market?”; “Will my expectations be met?”; “Who will the likely buyer be?”; “How long will it likely take?” and more. Our opinion of the MPSP is based on multiple methodologies, your specific knowledge of the business, current market conditions, future growth potential and opportunity, value drivers’ considerations, and much more which in turn provides unprecedented marketplace accuracy. Depending on the complexity of the business, detailed accuracy and timing of financial and other information provided by you, this process could take up to four weeks. It may be worth being reminded of the market reality that today’s buyers are generally knowledgeable, and motivated by both the reason the business is for sale, and by the right price being presented. They will not pay for improbable opportunities that are without substance. Our ability to accurately justify the asking price is a key value we bring to the relationship.

During this First Stage of our process as well as Stage Two, we may call on you to obtain additional information or discuss pertinent matters in order to ensure all details have been considered.

If you are comfortable with the results of the provided MPSP report and wish to continue the process, we then move to Stage Two of our process where your full cooperation will be solicited in order for us to successfully get to the desired sale of your business.

Successfully selling your business requires your full cooperation and commitment to the process.

Stage Two: Marketing Materials & Due Diligence Preparation

This is where we prepare the marketing materials to confidentially market and promote your business. These consist of multiple confidential and restricted exposure marketing documents to address differing levels of buyer interest and qualifications. During this process, and since most transactions are known to fall apart during the buyer due diligence process, we perform our own internal due diligence in order to be properly prepared and ready to accurately and successfully manage the buyers due diligence process in Stage Four.

In the preparation of the marketing materials, we draw from data and information gathered during the Stage One valuation process such as detailed business analytics, industry status, competition, assessment of Strengths, Weaknesses, Opportunities and Threats to both the business and industry, market size and status, buyer pool size, demographic and geography of target market, and a host of other points both historical and futuristic in order to confidentially and successfully present your business to qualified buyers in the most favourable light.

Stage Three: Marketing

This is where we passively and pro-actively market your business. We passively market the business by exposing the listing opportunity to a myriad of different business listing websites world wide, and not restricted to local markets. We also proactively expose it to our internal as well as our world wide affiliate pool of buyers and contacts numbering into the thousands. Also proactively, and especially where the potential buyer is deemed to be a strategic, financial, synergistic or industry buyer, we determine the target market, develop a proactive target contact list, and explicitly target such potential buyer targets in a confidential manner to determine their level of growth by acquisition interest and where possible, deliver competing offers to the table in order to effectively drive the business value to the best buyer candidate. This typically affords us the opportunity to confidentially sell your business in the shortest period of time, and for the best and most realistic price.

Stage Four: Offer & Due Diligence

Using competitive criteria matching techniques, and a proprietary dedicated Client Relations Management software, we prepare and negotiate offers for both maximum value and best fit. Once an offer is accepted, we manage the buyer due diligence process as previously noted and as prepared during Stage Two of the process in order to successfully avoid the pitfalls experienced by many others not being so strong and eloquent in their process. All buyer due diligence is fully managed with our proprietary systemic process and controlled access cloud based digital data room. Successfully clearing a buyer due diligence stage by waiving conditions precedent, signals that one is a step closer to the finish line, but does not necessarily provide a green light, or clear lane to the finish line. Like a chain is only as strong as the weakest link, Stage Five of our process is every bit as critical as all prior stages.

Stage Five: Closing

Where applicable, it is typical to perform an inventory count prior to the closing and this will be coordinated by your Broker/M&A Advisor together with any other pre closing required activities. In this final, yet critical stage, there are a multitude of things that can come into play and derail a deal including emotions. For this reason, our experienced professionals follow a methodical check list of almost 300 steps to ensure that nothing is left to chance, or to the whim of emotions, fears, or the ill-advised. Professionally managing this final stage including all advisors, and counsels to the transaction, the buyer, and the seller, is absolutely essential to the success of a closing. It is not because of set backs, or even surprises that so many transactions don’t get across the finish line. It is most often due to the lack of knowledge, unrealistic expectations, lack of required resources and pure lack of management of all the facets involved, and required, to successfully get across the transaction finish line. Boasting a better than 95% close ration versus the low industry standard, (in the 20% range) clearly reflects Pacific’s knowledgeable, and professional approach to the successful sale of your business.

When hiring Pacific, you are hiring a full compliment of professionals. With a dedicated lead professional on the file, you will capitalize on several hundred years of professional expertise, all the required resources to successfully sell you business, and all in one place where our success is directly tied to yours.