Exit Planning: 5 Tips for Success When You Sell a Business

If you’re planning to sell a Chicago business, the right business broker is an indispensable ingredient in the recipe for success. Guidance from an advisory firm can help you correctly price your company. An M&A firm can identify trends in the larger market, as well as your niche, and help you perfectly time your exit. But no matter when you put your company on the market, these tips will help you succeed. 

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Culture is Everything 

No matter how rosy your outlook is, you’re bringing two distinct entities together—and it’s not going to be one big happy family immediately. Adjusting takes time. If there are significant cultural differences, there’s likely to be an us vs. them mentality. You can defuse tensions with clear, specific communication and a cultural integration plan that begins well before you expect the two entities to fully integrate. 

If people’s jobs are safe, you must deliver this message—repeatedly. And if you need key employees to stay on board, you simply must incentivize them to do so. 

Focus on Fairness

It’s easy to become very Machiavellian in the cutthroat world of M&A. But ultimately, everyone wants to be treated fairly—buyers, sellers, employees, and stakeholders. People who feel deceived or cut out of the process are more likely to return the favor. Focus on what’s fair and right, and the entire process will proceed more smoothly. 

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Identify Walkaway Triggers 

The sunk cost fallacy can keep you throwing good money after a bad deal—and potentially missing out on your next good merger or acquisition. You shouldn’t trash an entire deal the moment something goes wrong, and you certainly shouldn’t make the decision to walk away based solely on ego or emotional considerations. This is why it’s so important to identify your walkaway triggers before you sit down at the negotiating table. 

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Treat Your Reputation Like an Asset 

What will this buyer say about you when all is said and done? Your reputation matters, especially if you plan to start a new company or business venture. Your reputation is far more valuable than any single deal clause or dollar amount. You can always earn back money, but reputation is something you can only lose once. So own your mistakes and treat others the way you want to be treated—and the way you want them to tell others you treated them. 

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Get the Right People Invested 

Who are the most powerful people at your company? You might be surprised to learn that their titles do not match their influence. The most beloved employees, the people everyone trusts and turns to, the managers who deeply understand what makes your company work—these are the people you must get invested in the merger. Talk with them early, and communicate with them openly. Perhaps most importantly, make it worth their while to stay. This means paying them fairly, and ensuring the merged company is one they’re going to want to continue working for.