Selling my Florist
Business
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are a number of documents that you should prepare before you attempt selling a florist. Your first step is to get a formal
business appraisal of your florist so that you have an idea of its
value, says Stan Crow, of S. Crow Collateral in Boise, Idaho. Your
appraiser will need a couple of documents: an adjusted balance sheet
and a "statement of seller's discretionary income."
If you don't want to spend the money on an appraisal, you can do it
yourself. Prepare a spreadsheet that shows the numbers from the
business' last three years' tax returns, with adjustments to add back
your salary, depreciation deductions, contributions, interest expense,
interest income, and any other items of income or expense that are not
integral to the business," he said. This document will show your
discretionary income for each of the last three years. The adjusted
balance sheet that you prepare (or ask your accountant to prepare for
you) will adjust your florist business's assets to fair market value and
eliminate assets and liabilities that a buyer will not acquire, such as
cash and leased equipment. We can help you do this. Just use
our contact form and indicate you want help with documents. Click
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Now, understand that delays kill deals. Prepare ahead of time
and collect your financials, tax returns, leases, etc. You
don’t want to have a prospective florist buyer waiting on you to
produce this stuff. A broker would not sell a
florist on the market until it is prepared and ready, so neither should
you. Think as a prospective buyer: What would they
want to see in order to analyze the your florist business?
The real detailed documents like bank statements can wait.
It is worth repeating that delays kill deals. Once you have a
prospective buyer, keep the process moving. Provide
information, set up meetings, negotiate and keep trying to move them
towards an offer. (This is where a broker comes in
handy. A broker allows a business owner to continue
to run their business during the months it takes to close a deal.) Need
a broker specializing in selling florists ? Contact us and indicate you
want a broker. Click
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Remember that you do not have to disclose everything with a buyer
before an offer and offer acceptance. Tell the buyer they
will have time for due-diligence (aka book-check), and if anything is
amiss they can back out. You can even hold back on
proprietary information that could be damaging if disclosed too
soon. For example, a customer list, or the name of your
flower wholesaler sources. (Don’t hold back negative information
though – get that out of the way before any offer is made).
Some florist owners readily admit to buyers that they hide cash from
the IRS. Think twice about that – if things go sour you’ve
given them some terrific ammo they can use against you. Best
plan is to not hide cash – at least the year before you plan to sell.
Then you can show all revenue and earnings with no fear.
We can provide you with business sales contracts, non-compete
agreements, etc. but you really need an attorney to at least make sure
you don’t fall into any deep holes. Some attorneys
see business acquisitions as a pay day, so if the transaction is tight
on money you really need to pay attention in that area.
Remember that your attorney works for you, and you make the decisions.
Use an escrow company for the transaction, but don’t stop working on
the deal even after it is in escrow. Keep it moving. It is
far too common for non-brokered deals to languish in escrow. Even more
often they just fall apart.
Once the deal is done, there are some forms required by the IRS (for an
asset sale, which most small business transactions are). Don't forget
those, or at least remind your CPA to submit them.
Don't hesitate to contact us to ask any questions about the process. Click
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