To get started, you will want to ensure your financial and essential documentation is in order. Potential buyers will want to review your financials, including your:
- Earnings
- Financial statements
- Tax returns
- Profit and loss statements
These documents will support your asking price, and a potential buyer may be more willing to buy when a business has well-organized records and books that clearly show the owner’s income. You’ll want to ensure that your numbers will make sense to potential buyers. If necessary, you may want to meet with a financial analyst or bookkeeper who can help get your documents in order.
The next step is to have a conversation with your broker about your business, helping them understand what might be appealing to a potential buyer.
We sell businesses with an owner’s annual net income – including their salary, perks, and benefits – of $250,000 to $10 million. We’ll review your financial information to identify the business trends and your true owner’s income. For example, we’ll review your past three years’ profit and loss statements and tax returns.
Next, we’ll give you an idea of a potential selling price for your daycare center. To sell, we’ll need to be able to defend your asking price, which is why the best tool for getting the maximum selling price is an accurate price that is backed up by solid financials.
If you decide you want to move forward, you will sign our Listing Agreement, which provides us with payment only if we successfully sell your preschool. We have two listing agreements – one for companies with more than $600,000 of net income and the other for companies with less than $600,000 of net income.
Once you sign our Listing Agreement, we will get to work on writing up an overview document about your business. Your overview document will provide information about your business while protecting the confidentiality of which daycare business is for sale. We will advertise this overview document on many websites, including ones that get millions of views.
We cover all of our costs related to advertising and marketing, so you don’t need to worry about any additional expenses. Additionally, we are happy to sign a confidentiality agreement that ensures we will protect your business’s financial information.
We will have people sign confidentiality agreements and give us information on their qualifications to purchase your daycare business before providing the details of your business for sale. We may have to filter through many shoppers before finding someone both qualified and interested.
It usually takes about one to eight weeks to connect you to the first potential buyer, and we typically introduce one to six buyers. It’s a process that unfolds gradually – it takes an average of six to 12 months to sell a daycare business.
Once we introduce a potential buyer, they will have questions to help them understand whether they would be interested enough to make an offer for the business. It’s also a good opportunity to see if the buyer is someone you feel comfortable taking over the business.
You will usually have to work with the buyer to help them transition to owning and running your business. It does help to keep an open mind because there are many different types of buyers, and the best offer may or may not come from someone in the business already.
When we get your first offer, we will help you analyze it to see if it is acceptable or requires a counter offer. Our goal is to get multiple offers that provide us with leverage and the best opportunity to get you a great price for your daycare or preschool business. Negotiation is essential for obtaining the best terms and price, and we have the expertise necessary to negotiate successfully on your behalf.
After negotiations are over and you have accepted an offer, the next step is to move to due diligence. The buyer will verify the information provided, and the attorneys will negotiate the details of a purchase and sale agreement that will take the terms of the offer letter and spell out things in more detail. The final step is to close the deal.
