Better Details for the Perfect Company Transition

You sold your business. But do not take out your golf bag or surfboard right away. Your work is not finished.You will still have to intervene to ensure smooth transitions. You need to tell the news to your employees and partners, take the reins of the business to the new owners and help them get started. In doing so, you will contribute to the success of your business after your departure and increase the chances of you repaying the loan you have granted to the buyer.

Follow these four tips for a smooth transition.

  1. Negotiate a favorable sales contract for you

The secret of a harmonious transfer lies in the planning of the transaction. The process begins with the negotiation of a clear and detailed sales contract and the search for the right buyer. The good buyer is someone with whom you get along well and who shares your vision of the company.

  1. Schedule the transfer with the buyer

The buyer cannot learn everything during the due diligence period. A well-planned succession plan will facilitate the transition for both the buyer and its financial partner (lenders as well as equity investors). The more you collaborate with him in planning the transfer, the fewer glitches there will be.

3.Communicate with employees and partners

Remember, your employees will experience emotions and stress during the transfer. Plan with the buyers a way to reassure them.Proper communication is crucial. You may need to offer incentives, such as bonuses and stock options, for them to stay.

Also decide with the buyer how you will advertise the sale to customers, suppliers and financial partners. Get the best ideas from now.

  1. Be ready to let go

It is possible that the new owner wants you to maintain a formal relationship with the business after the sale, for example, by holding a position on the board of directors or by acting as a consultant. This is particularly common in the case of a sale to a private individual or buyer in the finance industry, such as a private equity firm. If you retain a minority interest or provide financing to the buyer, you will want to know how much influence you will have in important decisions and what role you will play in the business after the sale is completed.

Besides, you should also be ready to let go. The seller is used to having all the power and he is rarely ready to give it up. Vendors should understand what is expected of them at the time of the transfer to ensure a successful transition and protect their legacy.

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